Cadillac Square Corporation determined that $1,128,800 of its research and development tax credit on its current-year tax return was uncertain, but that it was more likely than not to be sustained on audit. Management made the following assessment of the company's potential tax benefit from the deduction and its probability of occurring. Potential Estimated Benefit (000s) $ 1,128,800 964,500 233, 250 0 Individual Probability of Occurring (%) 47 30 15 8 Cumulative Probability of Occurring (%) 47 77 92 100 What amount of the tax benefit related to the uncertain tax position from the research and development tax credit can Cadillac Square Corporation recognize in calculating its income tax provision in the current year? Tax benefit amount recognized
Cadillac Square Corporation determined that $1,128,800 of its research and development tax credit on its current-year tax return was uncertain, but that it was more likely than not to be sustained on audit. Management made the following assessment of the company's potential tax benefit from the deduction and its probability of occurring. Potential Estimated Benefit (000s) $ 1,128,800 964,500 233, 250 0 Individual Probability of Occurring (%) 47 30 15 8 Cumulative Probability of Occurring (%) 47 77 92 100 What amount of the tax benefit related to the uncertain tax position from the research and development tax credit can Cadillac Square Corporation recognize in calculating its income tax provision in the current year? Tax benefit amount recognized
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Cadillac Square Corporation determined that $1,128,800 of its research and development tax credit on its current-year tax return was
uncertain, but that it was more likely than not to be sustained on audit. Management made the following assessment of the company's
potential tax benefit from the deduction and its probability of occurring.
Potential Estimated
Benefit (000s)
$ 1,128,800
964,500
233, 250
0
Individual
Probability of
Occurring (%)
47
30
15
8
Cumulative
Probability of
Occurring (%)
Tax benefit amount recognized
47
77
92
100
What amount of the tax benefit related to the uncertain tax position from the research and development tax credit can Cadillac Square
Corporation recognize in calculating its income tax provision in the current year?
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