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Question - Cadillac Square Corporation determined that $1,000,000 of its domestic production activities deduction on its current year tax return was uncertain, but that it was more likely than not to be sustained on audit. Management made the following assessment of the company's potential tax benefit from the deduction and its probability of occurring.
Potential est. benefit
Individual probability of occurring
Cumulative probability of occurring
340,000
40
272,000
25
65
170,000
20
85
0
15
100
Required - What amount of the tax benefit related to the uncertain tax position from the domestic production activities deduction can Cadillac Square Corporation recognize in calculating its income tax provision in the current year?
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