Skinner Corporation,a calendar year C corporation,had the following transactions during the current year:
$\begin{array}{llcc}
\text { Income from operations } &\$800,000 \
\text { Expenses from operations } &900,000\
\text {Dividends from Siskin Corporation (20\% ownership) } &200,000\
\
\text {Skinner's taxable income (or NOL) for the current year is: } &\
\end{array}$

Question

Skinner Corporation,a calendar year C corporation,had the following transactions during the current year: 
$\begin{array}{llcc}
  \text { Income from operations } &\$800,000  \
 \text { Expenses from operations } &900,000\
 \text {Dividends from Siskin Corporation (20\% ownership)  } &200,000\
\
 \text {Skinner's taxable income (or NOL) for the current year is:  } &\
\end{array}$

Quizplus · Accepted Answer

Skinner Corporation has a net operating loss (NOL) of $60,000. The income from operations is $800,000, and the expenses are $900,000, resulting in a $100,000 loss. However, dividends received from Siskin Corporation are partially deductible due to the dividends received deduction (DRD). With 20% ownership, the DRD is 50% of $200,000, which is $100,000. Thus, the taxable income is $800,000 - $900,000 + $100,000 = $0, but the DRD reduces the loss to $60,000.

Skinner Corporation,a Calendar Year C Corporation,had the Following Transactions During