Answer:
The Franklins can claim a recovery rebate credit of $__1,200______ for Cristina on their 2020 tax return.
Explanation:
The CARES Act provided economic relief payments, called "Economic Impact Payments" or stimulus payments, valued at $1,200 per eligible adult, based on household adjusted gross income (AGI), plus $500 for each additional qualifying dependent under 17 years of age. According to the Act, these payments will continue through Dec. 31, 2020, and the Franklins will not be able to claim a recovery if Cristina is above 17 years. The amount can still be claimed by all eligible taxpayers in 2021 when filing their 2020 tax returns.
Answer:
Option A is the correct answer,no adjustment is needed.
Explanation:
When related companies sell to each other,the sales transaction is not sales in actual sense,as it is likened to the left hand of an individual exchanging cash with the right hand,in other words, the cash is still owned by the same person.
The same concept is applicable to subsidiaries and parent,the sales recorded from a group perspective is when they sold to external third parties.
When sales happen between related companies, a provision for unrealized profits has to be made to the tune of inventory purchased from related companies not yet sold externally,as the whole of the goods have been to third parties, no such provision or adjustment is required.