Question 1 Not yet answered If a taxpayer does not know the total amount of proceeds to be received on an installment sale, e.g. contingent earn-out proceeds, they are precluded from using the installment method of accounting for the sale. Points out of 1.0 Select one: True Flag question False Question 2 Not yet answered Treasury Reg. $1.61-7(d) provides for the proceeds of a sale to be allocated first to accrued interest and then only the balance to be treated as the amount realized on the sale. By applying proceeds of a sale first to accrued interest, it is possible to have interest income and a capital loss realized on the sale. Points out of 1.0 Select one: Flag question True False Question 3 A taxpayer with an applicable financial statement may elect to expense and not capitalize amounts paid for property not exceeding $5,000 per invoice (or per item as substantiated by the invoice). Not yet answered Points out of 1.0 Select one: True Flag question False Question 4 Home construction contracts are exempt from the UNICAP rules if the taxpayer has three year average annual gross receipts of $25 million or less and the construction period is less than 2 years. Not yet answered Points out of 1.0 Select one: True Flag question False Question 5 The sale or other disposition of an installment obligation results in the recognition of gain or loss to the seller of the obligation. Not yet answered Select one: Points out of 1.0 True False Flag question Question 6 Not yet answered Lauren owns a building in the town of Ann Arbor that she uses for retail sales. The building contains one floor of retail space with very high ceilings. Lauren pays $50,000 to add a stairway and a mezzanine for the purposes of adding additional selling space with her building. The stairway and mezzanine are part of the building structure. The $50,000 amount must be capitalized as a betterment Points out of 1.0 Flag question Select one: True False Question 1 Not yet answered If a taxpayer does not know the total amount of proceeds to be received on an installment sale, e.g. contingent earn-out proceeds, they are precluded from using the installment method of accounting for the sale. Points out of 1.0 Select one: True Flag question False Question 2 Not yet answered Treasury Reg. $1.61-7(d) provides for the proceeds of a sale to be allocated first to accrued interest and then only the balance to be treated as the amount realized on the sale. By applying proceeds of a sale first to accrued interest, it is possible to have interest income and a capital loss realized on the sale. Points out of 1.0 Select one: Flag question True False Question 3 A taxpayer with an applicable financial statement may elect to expense and not capitalize amounts paid for property not exceeding $5,000 per invoice (or per item as substantiated by the invoice). Not yet answered Points out of 1.0 Select one: True Flag question False Question 4 Home construction contracts are exempt from the UNICAP rules if the taxpayer has three year average annual gross receipts of $25 million or less and the construction period is less than 2 years. Not yet answered Points out of 1.0 Select one: True Flag question False Question 5 The sale or other disposition of an installment obligation results in the recognition of gain or loss to the seller of the obligation. Not yet answered Select one: Points out of 1.0 True False Flag question Question 6 Not yet answered Lauren owns a building in the town of Ann Arbor that she uses for retail sales. The building contains one floor of retail space with very high ceilings. Lauren pays $50,000 to add a stairway and a mezzanine for the purposes of adding additional selling space with her building. The stairway and mezzanine are part of the building structure. The $50,000 amount must be capitalized as a betterment Points out of 1.0 Flag question Select one: True False
