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Vogel Corporation owns two subsidiaries, Song and Bird

Accounting

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Vogel Corporation owns two subsidiaries, Song and Bird. Song, located in State A, generated taxable income of $500,000. During this same period, Bird, located in State B, generated a loss of $100,000.

1. Determine Song's taxable income in States A and B, assuming that the subsidiaries constitute independent corporations under the tax law.
2. How does your answer change if the corporations constitute a unitary business?