1.At the end of 2010, what is the book basis and the tax basis of the asset?

Book basis Tax basis

a. $440,000$310,000

b.$490,000 $310,000

c.$490,000 $360,000

d.$440,000 $360,000

2At the end of 2010, which of the following deferred tax accounts and balances is reported on Pitman's balance sheet?

Account_ Balance

a. Deferred tax ass$52,000

b.Deferred tax liability $52,000

c.Deferred tax asset $78,000

d.Deferred tax liability $78,000

3. At the December 31, 2010 balance sheet date, Unruh Corporation reports an accrued receivable for financial reporting purposes but not for tax purposes. When this asset is recovered in 2011, a future taxable amount will occur and

a.pretax financial income will exceed taxable income in 2011.

b.Unruh will record a decrease in a deferred tax liability in 2011.

c.total income tax expense for 2011 will exceed current tax expense for 2011.

d.Unruh will record an increase in a deferred tax asset in 2011.

4.The percentage-of-completion method must be used when certain conditions exist. Which of the following is not one of those necessary conditions?

a.Estimates of progress toward completion, revenues, and costs are reasonably dependable.

b.The contractor can be expected to perform the contractual obligation.

c.The buyer can be expected to satisfy some of the obligations under the contract.

d.The contract clearly specifies the enforceable rights of the parties, the consideration to be exchanged, and the manner and terms of settlement.