During the current year, Schmidt Corporation has operating income of $75,000 and a net capital loss of $25,000. What is Schmidt's taxable income?
A)$- 0 -
B)$50,000
C)$72,000
D)$75,000
E)$90,000

Question

Quizplus · Accepted Answer

For corporations, net capital losses cannot be deducted against ordinary income. Therefore, Schmidt Corporation's taxable income remains at its operating income of $75,000, as the net capital loss of $25,000 does not reduce taxable income in the current year.

During the Current Year, Schmidt Corporation Has Operating Income of $75,000