Same facts as MC 4, except XYZ Inc is not a corporation, but is also an LLC. What is the effect, if any, on ABC Corps taxable income if XYZ LLC has net operating losses of $400 and QRS LLC has net income of $500? Assume no elections are made.

[For ease of not switching back - MC 4 fact pattern was: ABC Corp. has a wholly owned subsidiary, XYZ Inc. ABC Corp. and XYZ Inc. create QRS LLC under state law, with ABC Corp owning 7 of the 10 ownership units in QRS LLC, and XYZ Inc owns the other 3 units. ]

	A.	ABC Corp recognizes $350 of QRS LLCs income, representing 70% of its ownership in QRS LLC. XYZ LLC recognizes $150 of QRS LLCs income, representing 30% of its ownership in QRS LLC, this $150 of gain is offset by the $400 loss, for a net loss of $250 to XYZ LLC. ABC does not recognize this net loss of XYZ LLC. ABCs total income is $350.
	B.	ABC Corp recognizes $100 of income because QRS LLC is a partnership owned by ABC Corp and XYZ LLC.
	C.	ABC Corp recognizes $100 of income because it is the sole owner of XYZ LLC and QRS LLC.
	D.	None of the above, because XYZ LLC is itself an LLC, it cannot own QRS LLC.