Taxable compensation received from a business does not include:(Points : 1)

The employees share of FICA taxes

The employers share of FICA taxes

Bonuses paid to the employee

Reimbursements for personal expenses

Question 2. 2. Which of the following statements is correct?(Points : 1)

All FICA taxes are paid by the employer. The employee pays one-half of the FUTA tax. The employer pays the FUTA tax and the employers share of the FICA tax. The employee pays the FUTA tax and the employees share of the FICA tax.

Question 3. 3. Which of the following is not required to deduct an expenditure as a business expense?(Points : 1)

ordinary and necessary reasonable in amount incurred by the taxpayer recurring every year

Question 4. 4. Which of the following expenditures would not be deductible as a business expense?(Points : 1)

Costs of holding a business meeting at a local country club The fare for flying business class to an overseas meeting Paying the interest on a loan for the owners grandfather Paying the owners 17 year old son a salary of $9 per hour for cleaning and janitor services

Question 5. 5. During 2016, Jackson Corporation paid Brittany a salary of $110,000. How much is Jackson Corporations deduction (rounded to the nearest dollar) for its share of FICA taxes paid on Brittanys compensation?(Points : 1)

$8,942 $8,415 $7,347 $6,820

Question 6. 6. During 2016, Lee Corporation paid Nicole a salary of $118,000 and a bonus of $20,000. How much (rounded to the nearest dollar) is Lee Corporation required to withhold from Nicoles compensation for her share of FICA taxes?(Points : 1)

$9,027 $9,065 $9,348 $10,557

Question 7. 7. Stephanie, a taxpayer in the 28% marginal tax bracket, borrows $100,000 at 7% interest to invest in 6% tax-exempt municipal bonds (annual loan interest expense is $7,000). What is Stephanies interest expense deduction?(Points : 1)

$0 $1,000 $6,000 $7,000

Question 8. 8. Carlos, a self-employed construction contractor, contributed $5,000 to the re-election campaign of the local mayor in the hopes that his planned construction project will be approved. How much is Carloss deduction for this political contribution?(Points : 1)

$0 $25 $2,500 $5,000

Question 9. 9. Five years ago, Devin Corporation granted Laura nonqualified stock options to buy 1,000 shares of Devin stock at $22 per share exercisable for six years. At the date of grant, the stock was selling for $19 per share. Laura exercised the options this year when the market price was $28 per share. How much income must Laura recognize from the exercise of the options?(Points : 1)

zero $3,000 $6,000 $22,000

Question 10. 10. In 2011, Hu Corporation granted incentive stock options to Trevor to buy 5,000 shares of Hu stock at $20 per share exercisable for six years. At the date of grant, the stock was selling for $19 per share. In 2014, Trevor exercises the options when the market price was $38 per share. Trevor sells the stock in 2016 for $42 per share. How much income or gain does Trevor recognize and in which year?(Points : 1)

$110,000 capital gain in 2016 only $95,000 income in 2011 only $90,000 income in 2014 and $20,000 capital gain in 2016 $90,000 income in 2014 only

Question 11. 11. Perez Corporation paid the following expenses: $14,000 country club dues and $8,000 business meals at the country club. How much can Perez deduct for these expenses?(Points : 1)

$18,000 $11,000 $4,400 $4,000

Question 12. 12. In April 2016, Tobias was assigned to a job in the next county for the day. He drove 75 miles each way for the job, paid $4 in tolls, $7 for parking and $9 for lunch. What is his allowable business expense deduction?(Points : 1)

$56 $92 $93.50 $95.75

Question 13. 13. ABC Corporation awarded John 1,000 options in 2012; each option allows him to purchase one share of ABC Corporation stock for $20. The ABC stock was selling for $18 per share at the grant date. In 2014, John exercised the options when the stocks selling price was $40 per share. In 2016, John sells the stock for $50 per share. How much gain does John recognize in 2016 when he sells the stock if they are incentive stock options?(Points : 1)

$0 $10,000 $20,000 $30,000

Question 14. 14. Bob works for Brandon Corporation. Brandon reimburses Bob for the following expenses but does not include the reimbursement in his income: $800 country club dues, $1,200 business meals at the country club, and $200 transportation costs to out-of-town meetings. What is Brandon Corporations travel and entertainment deduction for these reimbursed expenses?(Points : 1)

$2,200 $1,100 $800 $700

Question 15. 15. Corinnes primary business is writing music. She uses one room in her home exclusively and regularly for the activity. The office occupies 300 of the 1,500 square feet in her apartment. She earned $2,100 this last year from her music. Her expenses for the entire home were $9,000 for rent and $2,000 for utilities. What is her home office expense deduction this year?(Points : 1)

$1,800 $2,100 $2,200 $4,000