Exam 7: Accounting Periods and Methods and Depreciation

Amy is a calendar year taxpayer reporting on the cash basis.Indicate which of the following income or expense items should not be included in her 2013 tax return.

Which of the following is not an acceptable method of accounting under the tax law?

Mary sells to her father,Robert,her shares in AA Corp for $55,000.The shares cost Mary $80,000.How much loss may Mary claim from the sale?

Aaron has a successful business with $50,000 of income in 2013.He purchased a new 7-year MACRS property with a cost of $7,000.For tax purposes,what is the largest write-off Aaron can obtain in 2013 for the new asset?

Taxpayers choosing the election to expense:

"Annualizing" is a method by which the taxpayer can usually decrease the amount of tax he or she pays.

For each of the following independent situations,indicate with a "Yes" if the asset is listed property.Indicate with a "No" if the asset is not listed property. a. Airplane used 25 percent for business $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ _________ b. Fleet of cabs $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ _________ c. A moving van $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ _________ d. DVD player used 10 percent for business $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ _________ e. A digital camera used 30 percent of the time to list eBay items_________

Mark the correct answer.In calculating depreciation:

Which of the following statements with respect to the depreciation of real property under MACRS is correct?

Which one of the following is a Section 197 intangible?

Section 197 intangibles: