Which of These Items Is Not an Adjustment to Taxable

question 27

Multiple Choice

Which of these items is not an adjustment to taxable income or net loss to compute current E&P?

• A) Dividends received deduction
• B) Tax-exempt income
• C) Net capital loss carryforward from the prior year tax return
• D)Refund of prior year taxes for an accrual method taxpayer

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Definitions:

Contribution Margin Ratio

A financial metric that represents the percentage of sale price that remains after variable costs are subtracted.

Sales Dollars

The total amount of money generated from the sale of goods or services before any expenses are subtracted.

Margin of Safety

The difference between actual or expected sales and the sales volume at which a company breaks even.

Fixed Costs

Rephrased: Expenses that remain constant regardless of the amount of goods or services produced by a business.