Assignment Paper
ParentCo and SubCo are calendar year corporations that keep their respective books on the accrual basis. The companies have taxable income of $200,000 and $250,000, respectively, for tax year 2013 (before consolidation adjustments, elimination entries and charitable deductions). The following transactions are included: 1. Land was sold by ParentCo to a third party for $80,000. The land was acquired from SubCo in 2011. SubCo acquired the land in 2008 for $48,000. 2. ParentCo’s taxable income includes a…