Question 1

Junod Corporation's book income is $500,000.What tax issues must be addressed in determining taxable income?

Accepted Answer

• What is the amount of federal income t

Question 2

Francine Corporation reports the following income and expense items for the tax year ending December 31:
   What is Francine Corporation's taxable income?

Accepted Answer

$55,000 + $28,000 - $20,000 -

Question 3

Which of the following is not subject to classification as a personal service corporation?

Accepted Answer

A) construction 
B) law 
C) accounting 
D) performing arts 
A) construction 
B) law 
C) accounting 
D) performing arts

Question 4

Identify which of the following statements is true.

Accepted Answer

A) A corporate NOL can be carried back two years and forward 15 years. 
B) An election to forgo an NOL carryback must be made on or before the return due date (including extensions)for the year in which the NOL is incurred. 
C) In computing an NOL for the current year,a deduction is allowed for NOLs from previous years. 
D) All of the above are false. 
A) A corporate NOL can be carried back two years and forward 15 years. 
B) An election to forgo an NOL carryback must be made on or before the return due date (including extensions)for the year in which the NOL is incurred. 
C) In computing an NOL for the current year,a deduction is allowed for NOLs from previous years. 
D) All of the above are false.

Question 5

Prince Corporation donates inventory having an adjusted basis of $26,000 and an FMV of $40,000 to County Hospital,which is a qualified public charity.What is the amount of Prince's deduction?

Accepted Answer

Prince may deduct the adjusted basis plu

Question 6

What are some of the advantages and disadvantages of filing a consolidated return?

Accepted Answer

The answer of What are some of the advantages and...

Question 7

Ben and Jerry Corporations are members of the Ben-Jerry controlled group.The corporations file separate tax returns for the current year and report the following results:
   a)If they elect no special apportionment plan,what is their combined tax liability?
b)If they DO elect a special apportionment plan,what is their lowest combined tax liability?

Accepted Answer

a)If they elect no special apportionment

Question 8

You are the CPA who prepares the tax returns for Dudley,his wife Margo,and their two corporations.Dave owns 100% of Duright Corporation's stock.Duright's current-year taxable income is $100,000.Margo owns 100% of Northwest Corporation's stock.Northwest's current-year taxable income is $150,000.Dudley and Margo file a joint federal income tax return.What issues should be considered with respect to the calculation of the three tax return liabilities?

Accepted Answer

• What is the tax liability for Duright

Question 9

Island Corporation has the following income and expense items for the year:   The taxable income of Island Corporation is

Accepted Answer

A) $100,000. 
B) $70,000. 
C) $47,000. 
D) $42,000. 
A) $100,000. 
B) $70,000. 
C) $47,000. 
D) $42,000.

Question 10

Identify which of the following statements is false.

Accepted Answer

A) Brown Corporation owns 60% of Clark Corporation and 65% of Davis Corporation.Davis Corporation owns 10% of Clark Corporation,and Clark Corporation owns 10% of Davis Corporation.The remaining stock is owned by an individual shareholder.Brown,Davis,and Clark Corporations are a parent-subsidiary controlled group. 
B) There are three categories of control groups: parent-subsidiary,brother-sister,and combined. 
C) The controlled group test is applied on December 31. 
D) A controlled group must apportion certain tax benefits among its members. 
A) Brown Corporation owns 60% of Clark Corporation and 65% of Davis Corporation.Davis Corporation owns 10% of Clark Corporation,and Clark Corporation owns 10% of Davis Corporation.The remaining stock is owned by an individual shareholder.Brown,Davis,and Clark Corporations are a parent-subsidiary controlled group. 
B) There are three categories of control groups: parent-subsidiary,brother-sister,and combined. 
C) The controlled group test is applied on December 31. 
D) A controlled group must apportion certain tax benefits among its members.

Question 11

Andy owns 20% of North Corporation and 60% of Tent Corporation.North and Tent have only one class of stock outstanding.Barbara owns 50% of North Corporation and 20% of Tent Corporation.North and Tent Corporations will be brother-sister corporations if

Accepted Answer

A) no stock ownership change occurs. 
B) Barbara acquires an additional 10% of North stock. 
C) Andy acquires an additional 10% of North stock and Barbara acquires an additional 10% of Tent stock. 
D) Barbara acquires an additional 10% of North stock and an additional 10% of Tent stock. 
A) no stock ownership change occurs. 
B) Barbara acquires an additional 10% of North stock. 
C) Andy acquires an additional 10% of North stock and Barbara acquires an additional 10% of Tent stock. 
D) Barbara acquires an additional 10% of North stock and an additional 10% of Tent stock.

Question 12

Which of the following items is a permanent difference between taxable and financial accounting income?

Accepted Answer

A) depreciation 
B) dividends-received deduction 
C) bad debts 
D) net capital loss 
A) depreciation 
B) dividends-received deduction 
C) bad debts 
D) net capital loss

Question 13

Jackel,Inc.has the following information for the current tax year:
   What is Jackel's charitable contribution deduction? What is Jackel's taxable income?

Accepted Answer

@#IMG-DLM& 
The 10% charitable contribut

Question 14

What are the various levels of stock ownership by corporate shareholders for the dividends-received deduction (DRD)? What is the DRD% for each level of ownership?

Accepted Answer

If a corporate shareholder owns less tha

Question 15

Discuss the estimated tax filing requirements for a C corporation.

Accepted Answer

Every corporation that expects to owe mo

Question 16

Identify which of the following is false.

Accepted Answer

A) Corporations that sell real property at a gain must report an additional 20% of the entire gain as ordinary income. 
B) Corporations selling real property that previously had been depreciated using an accelerated method are subject to Sec.291. 
C) Section 291 reduces the amount of net Sec.1231 gains that can be offset by corporate capital losses. 
D) Section 291 recapture applies to Sec.1250 property. 
A) Corporations that sell real property at a gain must report an additional 20% of the entire gain as ordinary income. 
B) Corporations selling real property that previously had been depreciated using an accelerated method are subject to Sec.291. 
C) Section 291 reduces the amount of net Sec.1231 gains that can be offset by corporate capital losses. 
D) Section 291 recapture applies to Sec.1250 property.

Question 17

Access Corporation,a large manufacturer,has a taxable income of $16,000,000.Access Corporation's tax is

Accepted Answer

A) $5,440,000. 
B) $5,530,000. 
C) $5,600,000. 
D) $5,680,000. 
A) $5,440,000. 
B) $5,530,000. 
C) $5,600,000. 
D) $5,680,000.

Question 18

A C corporation must use a calendar year as its tax year unless it has a substantial business purpose to use a fiscal year.

Accepted Answer

A) True 
 B)False

Question 19

Trail Corporation has gross profits on sales of $140,000 and deductible expenses of $180,000.In addition,Trail has a net capital gain of $60,000.Trail's taxable income is

Accepted Answer

A) a $20,000 loss. 
B) a $40,000 loss. 
C) $60,000. 
D) $20,000. 
A) a $20,000 loss. 
B) a $40,000 loss. 
C) $60,000. 
D) $20,000.

Question 20

For corporations,what happens to excess charitable contributions?

Accepted Answer

Corporations may not deduct charitable c

Exam 3: the Corporate Income Tax

Junod Corporation's book income is $500,000.What tax issues must be addressed in determining taxable income?

Francine Corporation reports the following income and expense items for the tax year ending December 31: What is Francine Corporation's taxable income?

Which of the following is not subject to classification as a personal service corporation?

Identify which of the following statements is true.

Prince Corporation donates inventory having an adjusted basis of $26,000 and an FMV of $40,000 to County Hospital,which is a qualified public charity.What is the amount of Prince's deduction?

What are some of the advantages and disadvantages of filing a consolidated return?

Island Corporation has the following income and expense items for the year: The taxable income of Island Corporation is

Identify which of the following statements is false.

Andy owns 20% of North Corporation and 60% of Tent Corporation.North and Tent have only one class of stock outstanding.Barbara owns 50% of North Corporation and 20% of Tent Corporation.North and Tent Corporations will be brother-sister corporations if

Which of the following items is a permanent difference between taxable and financial accounting income?

Jackel,Inc.has the following information for the current tax year: What is Jackel's charitable contribution deduction? What is Jackel's taxable income?

What are the various levels of stock ownership by corporate shareholders for the dividends-received deduction (DRD)? What is the DRD% for each level of ownership?

Discuss the estimated tax filing requirements for a C corporation.

Identify which of the following is false.

Access Corporation,a large manufacturer,has a taxable income of $16,000,000.Access Corporation's tax is

A C corporation must use a calendar year as its tax year unless it has a substantial business purpose to use a fiscal year.

Trail Corporation has gross profits on sales of $140,000 and deductible expenses of $180,000.In addition,Trail has a net capital gain of $60,000.Trail's taxable income is

For corporations,what happens to excess charitable contributions?

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