Beta Corporation reports the following results for the current year:
|Gross Income from Operations||$180,000|
|Dividends from less-than-20 % owned domestic corporations||$100,000|
In addition, Beta has a $50,000 NOL Carryover from the preceding tax year, and its qualified production activities income is $30,000.
a) What is Beta's taxable income for the current year?
b) What carrybacks or carryovers are available to other tax years?
The income owned by an individual or company on which the government levies tax is known as taxable income. Taxable income is not the total income earned by the assesses; it excludes the exempted part of income.
Answer and Explanation:
|Net operating income||30,000|
|Set-off from previous loss||(30,000)|
|Deduction for contribution||(20,000)|
|Net taxable income||80,000|
Therefore, the taxable income is $80,000.
b. The amount that is a carryover to next year is $20,000.
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from Accounting 202: Intermediate Accounting IIChapter 8 / Lesson 2