Dorsett Corporation's income tax return for Year 8 shows deductions exceeding gross income by $56,800. Included in the tax return are the following items: Net operating loss deduction (carryover from Year 7) $15,000 Dividends received deduction 6,800 What is Dorsett's net operating loss for Year 8

Dorsett's net operating loss for Year 8 is $41,800.

Explanation:

From the question, we have:

Amount by which deductions exceeding gross income = $56,800

Net operating loss deduction (carryover from Year 7) = $15,000

Dividends received deduction = $6,800

In order to calculate Dorsett's net operating loss for Year 8, the dividends received deduction of $6,800 has to be fully allowed but the net operating loss deduction (carryover from Year 7) of $15,000 wouldn't be not allowed.

Therefore, we have:

Dorsett's net operating loss for Year 8 = Amount by which deductions exceeding gross income - Net operating loss deduction (carryover from Year 7) = $56,800 - $15,000 = $41,800

Answer

1. c.  Grants

2. b. Subsidized financial loans

3. a. Unsubsidized financial loans

Grants: refer to funds that are given by grant makers to individuals for a specific purpose. These funds are not repayable. Most of the grants require compliance to certain conditions and regular reporting.

Subsidised Federal loans: refer to loans that are given to students who need financial aid for and other college expenses. Interest on this loan doesn't fall due until the time limit (150% of the program's tenure) on the loans is over.  This loan is available only to undergraduate students

Unsubsidized federal loans: are loans on which interest begins to accumulate as soon as the loan is disbursed. These loans are available to graduate and  undergraduate students.