Final answer:
A corporation cannot carry back a net capital loss to offset gains if it reduces tax liability, is from more than one year before, or creates/increases a net operating loss. Corporate profits have experienced fluctuations over the years with varying increases and decreases. Corporate tax is imposed on net profits and varies by country, with different rules for companies and individuals. Option 2.
Step-by-step explanation:
A corporation can carry back a net capital loss to a previous year to offset previous net capital gains. However, there are specific conditions under which a carryback is not permitted. These conditions include if carrying back the loss would reduce the tax liability for that previous year, if the carryback year is more than one year prior to the year of the net capital loss, or if by carrying back the loss, a net operating loss is created or increased. Option 2.
Corporate profits after tax have fluctuated over time, with increases in most years before 2008, followed by a significant drop during 2008 and into 2009. The profitability trend began to rise again in subsequent years, though the pace of increase has been less consistent.
Many countries impose a corporate tax on the income or capital of companies, which is determined much like taxable income for individuals. This tax is often levied on net profits and must follow specific rules that may differ significantly from those applied to individuals.