During the current year, the Melaleuca Corporation received dividends from 50-percent-owned domestic corporations in the amount of $100,000
a. Assuming that in addition to the dividend income the corporation has gross income from operations of $250,000 and deductible operating expenses of $210,000, calculate the amount of the corporation's dividends received deduction for the current year.
b. If, instead of $250,000 in gross income from operations, the corporation has $200,000 in gross income from operations and the same amount of dividends and expenses, calculate the amount of the corporation's dividends received deduction for the current year.
a. $80,000 = $100,000 × 80%
b. $72,000 = Lesser of: 80% × ($200,000 - $210,000 + $100,000) or $100,000 x 80%
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