Citrus Corporation is a calendar year S corporation with the following current year information: Operating loss Liabilities: Notes payable, Big Apple Bank 60,000 Notes payable, Grapefruit (individual) 40,000 On January 1 Grapefruit bought 60% of Citrus Corporation for $90,000. She then loaned Citrus Corporation $40,000 (the amount above under liabilities). How much of the operating loss may Grapefruit deduct currently? Assume the excess business loss limitation does not apply. O $114,000 $(240,000) $160,000 $130,000 O $150,000
Citrus Corporation is a calendar year S corporation with the following current year information: Operating loss Liabilities: Notes payable, Big Apple Bank 60,000 Notes payable, Grapefruit (individual) 40,000 On January 1 Grapefruit bought 60% of Citrus Corporation for $90,000. She then loaned Citrus Corporation $40,000 (the amount above under liabilities). How much of the operating loss may Grapefruit deduct currently? Assume the excess business loss limitation does not apply. O $114,000 $(240,000) $160,000 $130,000 O $150,000
Chapter18: Corporations: Organization And Capital Structure
Section: Chapter Questions
Problem 24CE
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