Income Tax Accounting 1 Worksheet assignment Total points 35 (each 3 points, except #111) 1. The tax laws allow taxpayers to use which of the following methods for accounting for research and experimentation costs paid or incurred in connection with a trade or business? a. Deduct the expenditures in the year in which they are paid or incurred. Capitalize the expenditures and amortize them ratably over a period of at least 60 months beginning in the month that the benefits are first realized. Capitalize the expenditures, but do not amortize them. d. All of the above. Either b. or c. b. In which one of the following circumstances will the taxable income limitation not affect the dividends received deduction? When the corporation owns less than 20 percent of the stock in the distributing corporation. When the corporation owns at least 20 percent but less than 50 percent of the stock in the distributing corporation. When the corporation owns at least 20 percent but less than 80 percent of the stock in the distributing corporation. d. When the corporation owns at least 80 percent of the stock in the distributing corporation During 20x1, a calendar year corporation incurs $52,000 of research and experimental (R&E) expenditures. The corporation elects to capitalize and amortize this expenditures. If the corporation first realizes benefits from the R&E expenditures on November 1, 20X1, its R&E deduction for 20X1 will equal: $4,633. a. b. c. $578. $3,544. d. $2,217. Advanced Accounting 1 Chapter 1 Assignment 1 (Due date September 17, 2019) Total points 30 Multiple Choice Questions: Each 2 points except # 1&2 1. In which of the following situations do accounting standards not require that the financial statements of the parent and subsidiary be consolidated? (1 Pt) A) A corporation creates a new 100 percent owned subsidiary B) A corporation purchases 90 percent of the voting stock of another company C) A corporation has both control and majority ownership of an unincorporated company D) A corporation owns less-than a controlling interest in an unincorporated company 2. A statutory consolidation is a type of business combination in which: (1 Pt) A) One of the combining companies survives and the other loses its separate identity. B) One company acquires the voting shares of the other company and the two companies continue to operate as separate legal entities. C) Two publicly traded companies agree to share a board of directors. D) Each of the combining companies is dissolved and the net assets of both companies are transferred to a newly created corporation. 3. Burrough Corporation paid $80,000 to acquire all of Helyar Company's net assets. Helyar reported assets with a book value of $60,000 and fair value of $98,000 and liabilities with a book value and fair value of $23,000 on the date of combination. Burrough also paid $3,000 to a search firm for finder's fees related to the acquisition. What amount will be recorded as goodwill by Burrough Corporation while recording its investment in Helyar? (Please show your computation even though it is multiple choice questions) A) SO B) S5,000 C) $8,000 D) $13,000 4. Plummet Corporation reported the book value of its nct assets at $400,000 when Zenith Corporation acquired 100 percent ownership. The fair value of Plummet's net assets was