All Matches

Solution Library

Expert Answer

Textbooks

Search Textbook questions, tutors and Books

Oops, something went wrong!

Change your search query and then try again

Result Not Found

Books FREE
Tutors
Study Help
Hire a Tutor
AI Study Help New

Search
Sign In
Register

study help
business
federal taxation

Questions and Answers of Federal Taxation

LO.8 On July 1, 2008, Red Corporation sold 100 of its common shares (worth $15 per share) to one of its employees, Bob, for $5 per share. The sale was subject to Bob’s agreement to resell the
LO.7 Elba is an officer of a local company that merges with a public company, resulting in a change of ownership. She loses her job as a result of the merger, but she receives a cash settlement of
LO.2 Discuss the tax treatment for the unrecovered basis in leasehold property owned by the lessee when the lease terminates.
LO.7 Red, Inc., a calendar year employer, has an accrued NQDC liability of $400,000 on December 31, 2010. During 2011, the company accrues another $70,000 of NQDC.On February 12, 2012, the company
LO.6 Samuel, age 32, loses his job in a corporate downsizing. As a result of his termination, he receives a distribution of the balance in his § 401(k) account of $20,000($25,000 − $5,000
LO.6 Gene, age 34, and Beth, age 32, have been married for nine years. Gene, who is a college student, works part-time and earns $1,500. Beth is a high school teacher and earns a salary of $34,000.
LO.6 In 2014, Joyce receives a $4,000 distribution from her Coverdell Education Savings Account, which has a fair market value of $10,000. Total contributions to her CESA have been $7,000. Joyce’s
LO.3 Discuss whether § 179 expensing may be taken on qualified property used in a transaction entered into for profit.
LO.4, 6 Louis is a participant in a SIMPLE IRA of his employer Brown, Inc. During 2012, he contributes 8% of his salary of $63,000, and his employer contributes 3%. What is the total amount that will
LO.6 Carri and Dane, ages 34 and 32, respectively, have been married for 11 years, and both are active participants in employer qualified retirement plans. Their total AGI in 2012 is $175,000, and
LO.6 Jeanne has $335,000 of earned income in 2012. Calculate the maximum amount she can contribute to a SEP.
LO.3 Explain how the § 179 limited expensing deduction affects the computation of MACRS cost recovery.
LO.6 Juana establishes a Roth IRA at age 40 and contributes the maximum amount per year to the Roth IRA for 25 years. The account is now worth $199,000, consisting of$75,000 in contributions plus
LO.6 Answer the following independent questions with respect to traditional IRA contributions for 2012:a. Juan, age 41, earns a salary of $28,000 and is not an active participant in any other
LO.3 Discuss the treatment of a § 179 expensing carryforward.
LO.4, 6 Answer the following independent questions with respect to a deductible IRA and § 401(k) contributions for 2012:a. Govind, age 31, earns a salary of $26,000 and is not an active participant
LO.3 Discuss the definition of taxable income as it is used in limiting the § 179 expensing amount.
LO.4, 6 Janet, age 29, is unmarried and is an active participant in a qualified retirement plan. Her modified AGI is $61,000 in 2012.a. Calculate the amount that Janet can contribute to a traditional
LO.4, 5 Harvey is a self-employed accountant with earned income from the business of $120,000 (after the deduction for one-half of his self-employment tax). He has a profit sharing plan (e.g.,
LO.2, 4, 5, 6 In 2012, Susan’s sole proprietorship earns $300,000 of self-employment net income (after the deduction for one-half of self-employment tax).a. Calculate the maximum amount that Susan
LO.4 Shyam is a participant in a SIMPLE § 401(k) plan. He elects to contribute 4% of his $40,000 compensation to the account, while his employer contributes 3%. What amount will not vest
LO.4, 10 Amber’s employer, Lavender, Inc., has a § 401(k) plan that permits salary deferral elections by its employees. Amber’s salary is $99,000, and her marginal tax rate is 33%.a. What is the
LO.4 In 2012, Magenta Corporation paid compensation of $45,300 to the participants in a profit sharing plan. During 2012, Magenta Corporation contributed $13,200 to the plan.a. Calculate Magenta’s
LO.4 Determine the maximum annual benefits payable to a participant from a defined benefit plan in the following independent situations:a. Frank, age 66, has been a participant for 17 years, and his
LO.4 Heather has been an active participant in a defined benefit plan for 19 years.During her last 6 years of employment, Heather earned $42,000, $48,000, $56,000,$80,000, $89,000, and $108,000,
LO.2 Marie has worked for Yellow Corporation for four and one-half years, but she has an offer to move to Red Corporation for a moderate increase in salary. Her average salary for Yellow has been
LO.1, 4 Concept, Inc., has a profit sharing plan with some participants earning$250,000 or more. The company can maximize its participants’ annual additions by using what percentage profit sharing
LO.2 Pam has six years of service completed as of February 5, 2012, her employment anniversary date. If her defined benefit plan uses the cliff vesting rule, determine Pam’s nonforfeitable
LO.2 Ned has five years of service completed as of February 5, 2012, his employment anniversary date. If his defined benefit plan [not a § 401(m) arrangement] uses the graded vesting rule, determine
LO.2 Black Corporation’s pension plan benefits 620 of its 1,000 highly compensated employees. How many of its 620 non-highly compensated employees must benefit to meet the ratio percentage test for
LO.2 Blonde Corporation has a total of 1,000 employees, of whom 700 are non-highly compensated. The retirement plan covers 300 non-highly compensated employees and 200 highly compensated employees.
LO.10 Aaron is retiring and wants to know the most tax-efficient sequence for liquidating his retirement assets. What do you tell him?
LO.8 When might the special election with respect to restricted stock be beneficial?
LO.3, 4 Discuss the implications of an automobile used in a trade or business having a gross vehicle weight (GVW) exceeding 6,000 pounds.
LO.7 What is the publicly held companies’ compensation limitation?
LO.7, 10 During his senior year in college, Sandy is drafted by the Los Angeles Dodgers.When he graduates, he expects to sign a five-year contract in the range of $1.7 million per year. Sandy plans
LO.6 Suppose an individual is 55 years old. How much of an additional catch-up IRA contribution can the person make?
LO.5 What funding vehicles are available for a Keogh plan?
LO.4 Scott Henry calls you and asks about a savings incentive match plan for employees(SIMPLE). Prepare a memo for the tax files about your response.
LO.6 Joey, who is single, is not covered by another qualified plan and earns $112,000 at his job in 2012. How much can he contribute to a traditional IRA or to a Roth IRA in 2012?
LO.4 Discuss how the limits on cost recovery apply to listed property.
LO.6, 10 Should a 31-year-old self-employed single woman establish a traditional deductible IRA, a traditional nondeductible IRA, or a Roth IRA? She has two children, ages 10 and 8.
LO.5 Explain the contribution limitations for a defined contribution Keogh plan and for a defined benefit Keogh plan.
LO.3, 6 Donna is retiring and wants to know her alternatives for receiving payments from her qualified retirement plan.
LO.3 Which of the following would be considered a tax benefit or advantage of a qualified retirement plan?a. Certain lump-sum distributions may be subject to capital gain treatment.b. Employer
LO.4 Discuss the purpose of the lease inclusion amount and explain how it is determined with respect to leased passenger automobiles.
LO.3, 6 Harvey Pehrson, who is age 71, is going to receive a lump-sum distribution from a qualified plan in 2012. He has asked you to provide him with a description of the alternatives available to
Identify any issues facing Penny with respect to distributions from her qualified retirement plan.
LO.2, 3, 6 Penny plans to retire in 2012 at age
LO.2 A qualified retirement plan must meet what requirements?
LO.1, 4 What is the maximum annual benefit payable under a defined benefit plan?
LO.1 An employee stock ownership plan (ESOP) has to be a profit sharing plan. Discuss this statement.
LO.1 What is a stock bonus plan?
LO.7 Explain the amortization period of a § 197 intangible if the actual useful life is less than 15 years.
LO.1 What are the four groups of qualified plans?
LO.1 Indicate whether the following statements apply to a pension plan (P), a profit sharing plan (PS), both (B), or neither (N):a. Forfeited amounts can be used to reduce future contributions by the
LO.1 Determine whether each of the following independent statements best applies to a defined contribution plan (DCP), a defined benefit plan (DBP), both (B), or neither (N):a. The amount to be
LO.1 List some fringe benefits that may be tax-free.
LO.1 List some types of deferred compensation arrangements.
LO.7 Harold and Bart own 75% of the stock of Orange Motors. The other 25% of the stock is owned by Jeb. Orange Motors entered into an agreement with Harold and Bart to acquire all of their stock in
LO.1 List some advantages of qualified pension plans.
LO.4, 7 Your client, Bob Young, is negotiating a sale of investment real estate for $12 million. Bob believes that the buyer would pay cash of $8 million and a note for $4 million or $3 million cash
LO.6 Amber Company has used the dollar-value LIFO technique for the past three years. The company has only one inventory pool. Its beginning inventory for the current year was computed as
LO.6 At the end of 2013, Magenta Manufacturing Company discovered that construction cost had been capitalized as a cost of the factory building in 2008 when it should have been treated as a cost of
LO.3, 6 In 2012, Gail changed from the lower of cost or market FIFO method to the LIFO inventory method. The ending inventory for 2011 was computed as follows:Item FIFO Cost Replacement Cost Lower of
LO.6 Silver Creek Ranch, LLC, is a small, family-owned cattle ranch that began operations in the current year. The ranch will grow hay that will be fed to its purebred cattle.It will take
LO.6, 7 Lavender Manufacturing Company began business in the current year. The company uses the simplified method to allocate mixed services costs to production. The company’s costs and expenses
LO.6 Grouse Company is a furniture retailer whose average annual gross receipts for the three preceding years exceeded $10 million. In the current tax year, the company purchased merchandise with an
LO.5, 7 Swallow Company is a large real estate construction company that has made a Subchapter S election. The company reports its income using the percentage of completion method. In 2013, the
LO.5 Ostrich Company makes gasoline storage tanks. Everything produced is under contract (that is, the company does not produce until it gets a contract for a product).Ostrich makes three basic
LO.5 On March 31, 2010, Big Boats Company entered into a contract with Vacations Unlimited to produce a state-of-the-art cruise ship, to be completed within three years.Big Boats estimated the total
LO.5 Rust Company is a real estate construction company with average annual gross receipts of $4 million. Rust uses the completed contract method, and the contracts require 18 months to complete.a.
LO.5 The Wren Construction Company reports its income by the completed contract method. At the end of 2012, the company completed a contract to construct a building at a total cost of $800,000. The
LO.4 George sold land to an unrelated party in 2011. His basis in the land was $45,000, and the selling price was $120,000—$30,000 payable at closing and $30,000 (plus 10%interest) due January 1,
LO.4 On December 30, 2011, Maud sold land to her son, Charles, for $50,000 cash and a 7% installment note for $350,000, payable over 10 years. Maud’s cost of the land was$150,000. In October 2013,
LO.4 On June 30, 2012, Kelly sold property for $240,000 cash and a $960,000 note due on September 30, 2013. The note will also pay 6% interest, which is slighty higher than the Federal rate.
LO.4 Kay, who is not a dealer, sold an apartment house to Polly during the current year (2012). The closing statement for the sale is as follows:Total selling price $ 160,000 Add: Polly’s share of
LO.4, 7 Ted purchased equipment and used materials to develop a patent. The development costs were deducted on prior returns. The bases and fair market values of the assets are presented below.Assets
LO.4, 7 Floyd, a cash basis taxpayer, has received an offer to purchase his land. The cash basis buyer will pay him either $100,000 at closing or $50,000 at closing and$56,000 two years after the
LO.7 Discuss the amortization of startup expenditures.
LO.2, 3, 6 Jeffrey Boyd, the president of Eagle Furniture Company (average annual gross receipts of $4 million), has prepared the company’s financial statements and income tax returns for the past
LO.2, 3 Raven Finance Company experiences bad debts of about 3% of its outstanding loans. At the end of the year, the company had outstanding receivables of $32 million.This balance included $2
LO.3 Ross Company is a computer consulting firm. The company also sells equipment to its clients. The sales of equipment account for approximately 40% of the company’s gross receipts. The company
LO.2 How do the all events and economic performance requirements apply to the following transactions by an accrual basis taxpayer?a. The company guarantees its products for six months. At the end of
LO.2 Blue Company, an architectural firm, has a bookkeeper who maintains a cash receipts and disbursements journal. At the end of the year, the company hires you to convert the cash receipts and
LO.2, 5 What accounting method (cash or accrual) would you recommend for the following businesses?a. A gift shop with average annual gross receipts of $900,000.b. An accounting partnership with
LO.2 Compute Mary’s income or deductions for 2012 using (1) the cash basis and (2)the accrual basis for each of the following:a. In May 2012, Mary paid a license fee of $1,200 for the period June
LO.2 Gold, Inc., is an accrual basis taxpayer. In 2012, an employee accidentally spilled hazardous chemicals on leased property. The chemicals destroyed trees on neighboring property, resulting in
LO.1 In 2011, Juan entered into a contract to write a book. The publisher advanced Juan $50,000, which was to be repaid out of future royalties. If the book was not completed by the end of 2012,
LO.1 Mauve Corporation began operations as a farm supplies business and used a fiscal year ending October 31.The company gradually went out of the farm supplies business and into the mail-order
LO.1 Zorn conducted his professional practice through Zorn, Inc. The corporation uses a fiscal year ending September 30 even though the business purpose test for a fiscal year cannot be satisfied.
LO.1, 7 The Cardinal Wholesale Company is an S corporation that began business on March 1, 2012. Robert, a calendar year taxpayer, owns 100% of the Cardinal stock. He has $400,000 taxable income from
LO.1 Red, White, and Blue are unrelated corporations engaged in real estate development.The three corporations formed a joint venture (treated as a partnership) to develop a tract of land. Assuming
LO.6 Blue is a retailer that uses the FIFO inventory method. Blue has consistently taken its physical inventory at the end of the day on the last day of its tax year, December 31.This practice is
LO.6 Opal, Inc., is about to make its first attempt to borrow from a local bank. The company uses LIFO for tax purposes, solely to defer taxes, and believes that income computed using the FIFO method
LO.6 Amber Auto Parts adopted the dollar-value LIFO inventory method. The company has consistently used a retail price index when it should have used a producer’s price index. As a result, its LIFO
LO.6 Largo Company is an engineering consulting business that uses the accrual method of accounting for its services. Mango Company is a manufacturer of nuts and bolts that also uses the accrual
LO.5 The Hawk Corporation builds yachts. The vessels it currently produces are practically identical and are completed in approximately 8 months. A customer has approached Hawk about constructing a
LO.5 Neal uses the percentage of completion method to report his gross income from long-term contracts that were to begin in 2012. In 2013, he completes a contract for more than the estimate of total
LO.5 Nathan uses the percentage of completion method to report income from his real estate construction contracts. A contract was begun in 2012 and completed in 2013.In 2012, Nathan reported gross

Showing 400 - 500 of 3271

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Last

Services

Sitemap
Fun
Definitions
Become Tutor
Study Help Categories
Recent Questions
Expert Questions

Company Info

Security
Copyrights
Privacy Policy
Terms & Conditions
SolutionInn Fee
Scholarship

Get In Touch

About Us
Contact Us
Career
Jobs
FAQ
Campus Ambassador

Secure Payment

Download Our App

© 2024 SolutionInn. All Rights Reserved