Solved by verified expert :722. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #1
Tax incentives constitute the primary motivation for most corporations to form
a conglomerate and file tax and financial accounting reports on a consolidated
basis.
a.
True
b. False
723. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #2
A consolidated Federal income tax return may be the product of a merger of the
affiliates, or of some other tax-favored reorganization.
a.
True
b. False
724. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #3
Over time, the consolidated return rules have shifted from penalizing joint
filing to allowing a tax-neutral means by which to elect to file on a
consolidated basis.
a.
True
b. False
725. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #4
Most of the Federal consolidated income tax return rules are found in detailed
sections of the Internal Revenue Code.
a.
True
b. False
726. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #5
The rules for computing Federal consolidated taxable income can differ a
significant way from those governing financial reporting for conglomerates.
a.
True
b. False
727. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #6
For consolidated tax return purposes, goodwill is amortized as a deduction to
taxable income. Under financial accounting rules, no such amortization is
allowed.
a.
True
b. False
728. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #7
A wholly owned LLC can join the parent’s consolidated group for book, but not
for tax, purposes.
a.
True
b. False
729. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #8
After a takeover, the parent takes a fair market value cost basis in the
subsidiary, for both book and tax purposes.
a.
True
b. False
730. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #9
When the parent acquires 51% of a subsidiary U.S. corporation, the subsidiary
can join the consolidated financial statements, but not the consolidated tax
return of the parent.
a.
True
b. False
731. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #10
A consolidated Federal income tax group must meet the eligibility requirements
of the Regulations only on the first day of the first year for which the
election to consolidate is effective.
a.
True
b. False
732. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #11
The right to file on a consolidated basis is available to a group of
corporations when they constitute a “parent-subsidiary affiliated group.”
a.
True
b. False
733. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #12
A Federal consolidated group can claim a dividends received deduction for
payments that the parent receives from other affiliates.
a.
True
b. False
734. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #13
In an affiliated group, the parent must own at least 50 percent of each of the
subsidiaries.
a.
True
b. False
735. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #14
A C corporation must leave the consolidated group if it is restructured as an
LLC.
a.
True
b. False
736. CHAPTER
8—CONSOLIDATED TAX RETURNS Question TF #15
A corporation organized outside of the U.S. can be included in a Federal
consolidated return.
a.
True
b. False
