1 1' What tax years may a new C corporation elect Question 2 and 3 pts 4 pts 2. What could cause a corporation to have a short tax year ? and D Question 3 3. a) In general a corporation that sells goods must use which accounting method 4 pts b) AC corporation that sells goods can use the cash method of accounting if its average For the last years do not exceed 4. 1. A corporation has short term capital gains of $100,000 and no other activity. How much is its tax liability 2. What would the answer to the previous question be if the gains were long term capital gains? 3. In its first year corporation Mardy has gross receipts from services of $300,000 and otherwise deductible expenses of $100,000. It also has a long term capital loss of $5,000. What is the corporation's taxable income for the year? 4 Suppose instead in year two, corporation Mardy had gross receipts from services of $500,000, otherwise deductible expenses of $230,000 and and a short term capital gain of $3,000. What is its taxable income for year two ? 5. Suppose in year two, corporation Mardy has gross receipts from services of $500,000, otherwise deductible expenses of $230,000 and and a long term capital loss of $5,000. What is its taxable income for year two Question 5 5. 1) A corporation begins business on July 1 of the current year. It incurs $5,360 of organizational expenditures. How much if anything can it deduct in the first year 2) How would the answer to the previous change if the total of the expenditures was $72,000, round to the nearest dollar 3. A large state bank wants to open a new branch in an area not covered by existing branches of the bank. It spends $63,000 on recruitment and advertising and opens on December of year 1. How much can it deduct in year 1? ? 6. 1. An accrual method corporation performs services for a client in year 1 worth $400,000. It sends out a bill at the beginning of year 2 and the client pays the bill in year 2. In which year doe the corporation report the income? 2. If the corporation was on the cash method what would the answer be to the previous question D Question 7 2 pts D Question 7 2 pts 7. 1. A corporation buys a building to use in its business for $100,000. It properly takes depreciation of $20,000. It sell the building a few years later for $110,000. How much if any of the gain would be treated as ordinary income 2. What would the answer to the previous question be if instead of a building the corporation purchased land that was used in it business and then sold it Question 8 8. 1 pts 1. An accrual basis calendar year corporation accrues bonuses to it's cash basis employees at the end of year 2 for $100,000. The bonuses are paid on March 31 of year 3. What year can the corporation deduct the bonuses Question 9 9. 3 pts 1. A calendar year cash basis corporation pledges a contribution to an eligible charity at the end of year 5. It makes the payment in early January of year 6. In what year can the corporation take the deduction? 2. Suppose the corporation was an accrual basis taxpayer. It accrues the contribution at the end of year 3. Assuming any other requirements are met, if the corporation wants the deduction in year 3 when must payment be made by? 3. In addition to payment by the required date what else has to happen for the contribution to be deducted in year 3? 10. 1. In 2022 A corporation donates 100 shares of stock worth $25,000 that it purchased for $1,000 several years ago as an investment. Ignoring limitations, what is the amount of the corporation's contribution deduction? 2. Would the answer to the previous question change, and if so how, if instead of stock the corporation donated an old piece of jewelry to the museum of modern art. The jewelry was worth $25,000 and was purchased several years ago for $1,000. The museum sells the jewelry since it does not fit with what is being shown in the museum. What is the amount of the corporation's contribution deduction? 3. A corporation buys a piece of machinery for $20,000 that is uses in its business. It properly takes $6,000 of depreciation over the years. After a few years it donates the machinery to a charity that trains mechanics and uses the machine in its exempt charitable purpose. At the time of the contribution the machine is worth $16,500. If the corporation is entitled to a charitable contribution for donation of the machine indicate the amount. Otherwise enter N/A D