Musketeer Corporation has the following income and expense items during the current year: The allowed dividends-received deduction is

Question

Musketeer Corporation has the following income and expense items during the current year:  The allowed dividends-received deduction is

Quizplus · Accepted Answer

Based on the given information, the dividends-received deduction is calculated based on the taxable income before any deduction for the dividends received. In this case, the taxable income before any deduction for dividends is $800,000 + $240,000 - $100,000 - $60,000 - $40,000 - $60,000 = $880,000. The dividends-received deduction for Musketeer Corporation would be 70% of the dividends received which is $240,000 x 70% = $168,000. Therefore, the best choice is B.

Musketeer Corporation Has the Following Income and Expense Items During