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Former Member
Dec 02, 2007 at 01:39 AM

Elimnination of Investment Income/Expense

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I have requirement to eliminiate intercompany investment against expenses.

Company X has investment in company Y for 90% of stocks.

Company Y distributes dividend income ( $1000)and Company X share is 90%($900)

Company X accounts for investment income , but pays a tax of 30%. Hence accounts for investment income as $630, tax is $270.

How will this work in elimination where X will report income of $630 and Y will report the amount to be eliminated as $900.