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Red Corporation manufactures hand tools in the United States. For the current year, the QPAI
derived from the manufacture of hand tools was $1 million. Reds taxable income for the current
year was $2 million. Last year, Red had an NOL of $800,000, which Red elected to carry
forward. Calculate Reds DPAD for the current year.
Solution
DPAD = 9% of QPAI = 0.09 x 1000000 = $90000

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Red Corporation manufactures hand tools in the United States. For th.pdf

  • 1. Red Corporation manufactures hand tools in the United States. For the current year, the QPAI derived from the manufacture of hand tools was $1 million. Reds taxable income for the current year was $2 million. Last year, Red had an NOL of $800,000, which Red elected to carry forward. Calculate Reds DPAD for the current year. Solution DPAD = 9% of QPAI = 0.09 x 1000000 = $90000