Question 1

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 2

Identify which of the following statements is true.

Accepted Answer

A)  "Ordinary income property" with regard to the charitable contribution deduction does not include property whose sale would have produced a short-term capital gain. 
B)  The Twilight Corporation purchases inventory for $5,000. Its FMV on the date it is donated to the Blue-Gray Hospital for the care of the needy is $14,000. The maximum charitable contribution deduction available for the donation is $9,000. 
C)  Corporations' charitable deductions are limited to 20% of their adjusted taxable income. 
D)  All of the above are false. 
A)  "Ordinary income property" with regard to the charitable contribution deduction does not include property whose sale would have produced a short-term capital gain. 
B)  The Twilight Corporation purchases inventory for $5,000. Its FMV on the date it is donated to the Blue-Gray Hospital for the care of the needy is $14,000. The maximum charitable contribution deduction available for the donation is $9,000. 
C)  Corporations' charitable deductions are limited to 20% of their adjusted taxable income. 
D)  All of the above are false.

Question 3

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 4

Which of the following items indicate that a company does not need a valuation allowance?

Accepted Answer

A)  existing sales contracts that will produce sufficient income to realize the deferred tax asset 
B)  excess of appreciated asset value over tax basis sufficient to realize the deferred tax asset 
C)  a strong history of earnings without considering the deferred tax asset 
D)  All of the above are correct. 
A)  existing sales contracts that will produce sufficient income to realize the deferred tax asset 
B)  excess of appreciated asset value over tax basis sufficient to realize the deferred tax asset 
C)  a strong history of earnings without considering the deferred tax asset 
D)  All of the above are correct.

Question 5

Corporations are permitted to deduct $3,000 in net capital losses annually.

Accepted Answer

A) True 
 B)False

Question 6

What are the four principles underlying ASC 740?

Accepted Answer

1)Recognize a current-year tax liability

Question 7

Identify which of the following statements is true.

Accepted Answer

A)  A corporation that accrues compensation payable to an employee must pay the amount within two and one-half months after the close of the taxable year to deduct the amount in the year of the accrual. 
B)  Accrued compensation that is deductible in the year of accrual is considered to be part of an IRS deferred compensation plan. 
C)  Accrued compensation not paid within three and one-half months after the close of the corporation tax year is deducted in the year following the accrual. 
D)  All of the above are false. 
A)  A corporation that accrues compensation payable to an employee must pay the amount within two and one-half months after the close of the taxable year to deduct the amount in the year of the accrual. 
B)  Accrued compensation that is deductible in the year of accrual is considered to be part of an IRS deferred compensation plan. 
C)  Accrued compensation not paid within three and one-half months after the close of the corporation tax year is deducted in the year following the accrual. 
D)  All of the above are false.

Question 8

In 2011,Summer Corporation earns domestic gross receipts of $2 million and incurs allocable expenses of $800,000.It has $400,000 of income from other sources,resulting in taxable income of $1.6 million before the U.S.production activities deduction.What is its U.S.production activities deduction?

Accepted Answer

A)  $120,000 
B)  $108,000 
C)  $60,000 
D)  $36,000 
A)  $120,000 
B)  $108,000 
C)  $60,000 
D)  $36,000

Question 9

Once a corporation has elected a taxable year,it can change the taxable year without IRS permission if

Accepted Answer

A)  the resulting short period has a net operating loss of $100,000 that the corporation wants to carry forward. 
B)  the corporation changed its taxable year seven years ago. 
C)  the corporation is not an S Corporation. 
D)  a corporation can change its taxable year without IRS permission in all of the above situations. 
A)  the resulting short period has a net operating loss of $100,000 that the corporation wants to carry forward. 
B)  the corporation changed its taxable year seven years ago. 
C)  the corporation is not an S Corporation. 
D)  a corporation can change its taxable year without IRS permission in all of the above situations.

Question 10

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 11

When computing corporate taxable income,what is the proper sequencing of deductions?

Accepted Answer

The correct order for taking deductions

Question 12

Miller Corporation has gross income of $100,000,which includes $40,000 of dividends from a 10%-owned corporation.In addition,Miller has $80,000 of expenses.Miller's taxable income or loss is

Accepted Answer

A)  $20,000. 
B)  $6,000. 
C)  $0. 
D)  ($8,000). 
A)  $20,000. 
B)  $6,000. 
C)  $0. 
D)  ($8,000).

Question 13

Newco Corporation has asked you to help determine whether it should use the accrual method or the cash method of accounting.What are the tax issues involved in making this determination?

Accepted Answer

• Is Newco a farming corporation?
• If s

Question 14

Organizational expenses incurred after 2004 are amortized over five years.

Accepted Answer

A) True 
 B)False

Question 15

Green Corporation is incorporated on March 1 and begins business on June 1.Green's first tax year ends on October 31,i.e.,a short year.Green incurs the following expenses during the year:   What is the deduction for organizational expenses if Green chooses to deduct its costs as soon as possible?

Accepted Answer

A)  $36,000 
B)  $5,028 
C)  $667 
D)  $500 
A)  $36,000 
B)  $5,028 
C)  $667 
D)  $500

Question 16

Ryan Corporation sells a commercial building and land.The sales proceeds attributable to the building is $145,000.When purchased,the building is allocated $75,000 of the purchase price.The firm has depreciated the building using the MACRS rules.The MACRS deductions taken total $60,000.What is the amount and character of Ryan's recognized gain?

Accepted Answer

Realized gain: $145,000 - ($75,000 - $60

Question 17

Discuss the estimated tax filing requirements for a C corporation.

Accepted Answer

Every corporation that expects to owe mo

Question 18

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 19

Continental Corporation anticipates a 34% tax rate for the next several years and has a $500,000 NOL carryover.
a)What is the journal entry to record the NOL carryover's tax benefits,assuming that no valuation is needed?
b)What is the journal entry if Continental Corporation estimates that one-half of the NOL will not be realized?

Accepted Answer

The answer of Continental Corporation anticipates a 34% tax rate...

Question 20

Davis Corporation,a manufacturer,has taxable income of $150,000.Davis's regular tax liability is

Accepted Answer

A)  $15,000. 
B)  $41,750. 
C)  $34,000. 
D)  $35,000. 
A)  $15,000. 
B)  $41,750. 
C)  $34,000. 
D)  $35,000.

Identify which of the following statements is true.

Identify which of the following statements is true.

Which of the following items indicate that a company does not need a valuation allowance?

Corporations are permitted to deduct $3,000 in net capital losses annually.

What are the four principles underlying ASC 740?

Identify which of the following statements is true.

In 2011,Summer Corporation earns domestic gross receipts of $2 million and incurs allocable expenses of $800,000.It has $400,000 of income from other sources,resulting in taxable income of $1.6 million before the U.S.production activities deduction.What is its U.S.production activities deduction?

Once a corporation has elected a taxable year,it can change the taxable year without IRS permission if

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

When computing corporate taxable income,what is the proper sequencing of deductions?

Miller Corporation has gross income of $100,000,which includes $40,000 of dividends from a 10%-owned corporation.In addition,Miller has $80,000 of expenses.Miller's taxable income or loss is

Newco Corporation has asked you to help determine whether it should use the accrual method or the cash method of accounting.What are the tax issues involved in making this determination?

Organizational expenses incurred after 2004 are amortized over five years.

Green Corporation is incorporated on March 1 and begins business on June 1.Green's first tax year ends on October 31,i.e.,a short year.Green incurs the following expenses during the year: What is the deduction for organizational expenses if Green chooses to deduct its costs as soon as possible?

Discuss the estimated tax filing requirements for a C corporation.

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?

Davis Corporation,a manufacturer,has taxable income of $150,000.Davis's regular tax liability is

Tax Research

Corporate Formations and Capital Structure

Corporate Nonliquidating Distributions

Other Corporate Tax Levies

Corporate Liquidating Distributions

Corporate Acquisitions and Reorganizations

Consolidated Tax Returns

Partnership Formation and Operation

Special Partnership Issues

US Corporations

The Gift Tax

The Estate Tax

Income Taxation of Trusts and Estates

Administrative Procedures

US Taxation of Foreign-Related Transactions

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Exam 3: The Corporate Income Tax

Identify which of the following statements is true.

Identify which of the following statements is true.

Which of the following items indicate that a company does not need a valuation allowance?

Corporations are permitted to deduct $3,000 in net capital losses annually.

What are the four principles underlying ASC 740?

Identify which of the following statements is true.

In 2011,Summer Corporation earns domestic gross receipts of $2 million and incurs allocable expenses of $800,000.It has $400,000 of income from other sources,resulting in taxable income of $1.6 million before the U.S.production activities deduction.What is its U.S.production activities deduction?

Once a corporation has elected a taxable year,it can change the taxable year without IRS permission if

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

When computing corporate taxable income,what is the proper sequencing of deductions?

Miller Corporation has gross income of $100,000,which includes $40,000 of dividends from a 10%-owned corporation.In addition,Miller has $80,000 of expenses.Miller's taxable income or loss is

Newco Corporation has asked you to help determine whether it should use the accrual method or the cash method of accounting.What are the tax issues involved in making this determination?

Organizational expenses incurred after 2004 are amortized over five years.

Green Corporation is incorporated on March 1 and begins business on June 1.Green's first tax year ends on October 31,i.e.,a short year.Green incurs the following expenses during the year: What is the deduction for organizational expenses if Green chooses to deduct its costs as soon as possible?

Discuss the estimated tax filing requirements for a C corporation.

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?

Davis Corporation,a manufacturer,has taxable income of $150,000.Davis's regular tax liability is

Tax Research

Corporate Formations and Capital Structure

Corporate Nonliquidating Distributions

Other Corporate Tax Levies

Corporate Liquidating Distributions

Corporate Acquisitions and Reorganizations

Consolidated Tax Returns

Partnership Formation and Operation

Special Partnership Issues

US Corporations

The Gift Tax

The Estate Tax

Income Taxation of Trusts and Estates

Administrative Procedures

US Taxation of Foreign-Related Transactions

Filters