Golf Corp. (GC), a calendar-year accrual-method corporation, held its directors meeting on December 15 of year 1.

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Golf Corp. (GC), a calendar-year accrual-method corporation, held its directors meeting on December 15 of year 1. During the meeting the board of directors authorized GC to pay a $75,000 charitable contribution to the World Golf Foundation, a qualifying charity.
a. If GC actually pays $50,000 of this contribution on January 15 of year 2 and the remaining $25,000 on March 15 of year 2, what book-tax difference will it report associated with the contribution in year 1 (assume the 10 percent limitation does not apply)? Is it favorable or unfavorable? Is it permanent or temporary?
b. Assuming the same facts as in part a., what book-tax difference will GC report in year 2 (assuming the 10 percent limitation does not apply)? Is it favorable or unfavorable?
c. If GC actually pays $50,000 of this contribution on January 15 of year 2 and the remaining $25,000 on April 15 of year 2, what book-tax difference will it report associated with the contribution in year 1 (assume the 10 percent limitation does not apply)? Is it favorable or unfavorable? Is it permanent or temporary?
d. Assuming the same facts as in part c., what book-tax difference will GC report in year 2 (assuming the 10% limitation does not apply)? Is it favorable or unfavorable?
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Taxation Of Individuals And Business Entities 2015

ISBN: 9780077862367

6th Edition

Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver

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