jazz Corporation owns 10 percent of the Mitchell Corporation stock. Mitchell distributed a $10,000 dividend to Jazz Corporation. Jazz Corporations taxable income (loss) before the dividend income was ($2,000). What is the amount of Jazz's dividends received deduction on the dividend it received from Mitchell Corporation

$2,000

Explanation:

When a corporation owns less than 20% of another corporation, only 50% of the dividend it receives can be used as a deduction.

In this case, Jazz owns less than 10% of Mitchell and so can use 50% of $10,000 as a deduction:

= 50% * 10,000

= $5,000

However, Jazz incurred a loss of $2,000 which means that they will only need to deduct that $2,000 from the allowable $5,000.

Total amount of Benson's product costs - $ 205,200

Explanation:

Computation of Benson's product cost

Materials Used                                                       $ 120,000

Wages for assembly line workers                        $   62,800

Property taxes for factory                                     $    14,000

Salary for factory manager                                   $      8,400

Total items considered for product costs           $ 205,200

The other data provided in the question i.e Rent and Utilities for administrative offices, CEO' s salary and depreciation on delivery equipment are of the nature of selling and administrative expenses, and thus is not included in product costs.