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Study Resources (Accounting)

88) Chris, a single taxpayer, had the following income and deductions during 2013? Salary$55,000 Interest on bank account              300 Tax-exempt interest200 Deduction for AGI4,000 Itemized deductions 8,000 Taxes withheld 6,500 Calculate Chris's tax liability due or refund for 2013. 89) During the current tax year, Frank Corporation generated gross income of $1,900,000 and had ordinary and necessary.
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1) Except as otherwise provided, gross income means all income from whatever source derived. 2) Under the economist's definition, unrealized gains, as well as gifts and inheritances, are income. 3) Under both the accounting and tax law concepts of income, income must be "realized." 4) Under the tax concept of income, all realized.
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51) Ms. Marple's books and records for 2013 reflect the following information: Salary earned this year $65,000 Interest on savings account (credited to her account in 2013, withdrawn in 2014) 1,000 Interest on county bonds earned and collected in 2013 2,000 What is the amount Ms. Marple should include in her gross income in 2013? A) $66,000 B) $67,000 C).
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119) Paige is starting Paige's Poodle Parlor and is considering alternative organizational forms. She anticipates the business will earn $100,000 from operating before compensating her for her services and before charitable contributions. Page, who is single, has $3,000 of income from other sources and other itemized deductions of $12,000. Her.
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21) A check received after banking hours is considered constructively received by the payee even though the check can not be converted to cash. 22) Interest credited to a bank savings account is taxed regardless of whether or not it is withdrawn. 23) Interest on Series E and Series EE U.S. savings.
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114) Maxine, who is 76 years old and single, is appropriately claimed as a dependent on her daughter Beth's tax return. During 2013 she received $500 interest on a savings account. She had a part time job that earned $3,000. Her total itemized deductions were $1,300. Required: Compute Maxine's taxable income.
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31) Qualified dividends received by individuals are taxed at the same rate as ordinary income. 32) Distributions in excess of a corporation's current and accumulated earnings and profits are treated as a nontaxable recovery of capital unless they exceed the basis of the stock. 33) XYZ Corporation declares a 10 percent stock.
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21) Adam Smith's canons of taxation are equity, certainty, convenience and economy. 22) The primary objective of the federal income tax law is to achieve various economic and social policy objectives. 23) Individuals are the principal taxpaying entities in the federal income tax system. 24) The various entities in the federal income tax.
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41) A single taxpayer provided the following information for 2013: Salary $80,000 Interest on local government bonds (qualifies as a tax exclusion) 4,000 Allowable itemized deductions 13,000 What is taxable income? A) $57,100 B) $63,100 C) $67,000 D) $67,100 42) Which of the following types of itemized deductions are included in the category of miscellaneous expenses that are deductible only if the.
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41) Charlotte pays $16,000 in tax deductible property taxes. Charlotte's marginal tax rate is 28%, effective tax rate is 22% and average rate is 25%. Charlotte's tax savings from paying the property tax is A) $3,520. B) $4,000. C) $4,480. D) $11,520. 42) Anne, who is single, has taxable income for the current year of.
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93) What is a corporate inversion and why was this provision enacted? 94) Explain the alternatives available to individual taxpayers for reporting foreign income taxes that have been paid or accrued. 95) Compare the foreign tax payment claimed as a deduction versus a similar payment claimed as a credit. Create an example.
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122) In 2013 Carol and Robert have salaries of $35,000 and $27,000, respectively. Their itemized deductions total $8,000. They are married, under 65, and live in a common law state. a.Compute their taxable income assuming that they file a joint return. b.Compute their taxable income assuming that they file separate returns and.
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97) Guinness Corporation, a U. S. corporation, began operating overseas in the current year. This year, Guinness sold machine tools that it manufactured in the United States to Canadian companies from a branch office located in Toronto, purchased a 40% investment in a Brazilian corporation from which it received a.
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1) Gross income is income from whatever source derived less exclusions. 2) Although exclusions are usually not reported on an individual's income tax return, interest income on state and local government bonds must be reported on the tax return. 3) Generally, deductions for (not from) adjusted gross income are personal expenses specifically.
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41) Identify which of the following statements is false. A) A nonresident alien can elect to have income earned on a passive real estate investment treated as trade or business income. B) Nonresident aliens may use either the standard deduction or claim itemized deductions. C) Nonresident aliens are generally allowed to claim only.
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61) David's father is retired and receives $14,000 per year in social security benefits. David's father saves $4,000 of the benefits and spends the remaining $10,000 for his support. How much support must David provide for his father to meet the dependent support requirement? A) $10,000 B) $10,001 C) $14,000 D) $14,001 62) Which of.
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31) The tax law encompasses administrative and judicial interpretations, such as Treasury regulations, revenue rulings, revenue procedures, and court decisions, as well as statutes. 32) Generally, tax legislation is introduced first in the Senate and referred to the Senate Finance Committee. 33) The Internal Revenue Service is the branch of the Treasury.
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101) Homer Corporation's office building was destroyed by fire. Homer collected insurance of $250,000, which equaled the building's basis, and $150,000 for profits lost during the time the company was rebuilding the office building. What is the amount taxable this year? A) $0 B) $150,000 C) $250,000 D) $400,000 102) During 2013, Christiana's employer withheld.
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51) Which of the following statements is incorrect? A) Property taxes are levied on real estate. B) Excise taxes are assessed on items such as gasoline and telephone use. C) Gift taxes are levied on the recipient of a gift. D) The estate tax is based on the fair market value of property at.
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61) Rocky and Charlie form RC Partnership as equal partners. Rocky contributes $100,000 into RC while Charlie contributes real estate with a fair market value of $100,000. During the current year, RC earned net income of $600,000. The partnership distributes $200,000 to each partner. The amount that Rocky should report.
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11) AAA Corporation distributes an automobile to Alexandria, a shareholder, in lieu of a cash dividend. Alexandria must report the value of the automobile as dividend income. 12) The portion of a taxpayer's wages that are garnished by court order and forwarded to pay a delinquent bank loan are not taxable.
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11) If a taxpayer's total tax liability is $4,000, taxable income is $20,000, and total economic income is $40,000, then the effective tax rate is 20 percent. 12) All states impose a state income tax which is generally based on an individual's federal adjusted gross income (AGI) with minor adjustments. 13) The.
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76) Cane Corporation owns 45% of the stock of Edmonton Airline Corporation. In its first year of operations, Edmonton Airline, a Canadian corporation, reports $400,000 of E&P and pays a $100,000 dividend to Cane Corporation. Edmonton Airline pays $50,000 in Canadian income taxes. All amounts are expressed in U.S. dollars..
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