Question 1

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 2

Richards Corporation has taxable income of $280,000 calculated before the charitable contribution deduction and before its dividends-received deduction of $34,000.Richards makes cash contributions of $35,000 to charitable organizations.What is Richards Corporation's charitable contribution deduction for the current year?

Accepted Answer

A) $24,600 
B) $28,000 
C) $31,400 
D) $35,000 
A) $24,600 
B) $28,000 
C) $31,400 
D) $35,000

Question 3

Jackson Corporation,not a dealer in securities,realizes taxable income of $80,000 from the operation of its business.Additionally,Jackson Corporation realizes a $10,000 long-term capital loss from the sale of marketable securities.Explain the treatment of the loss on the corporate return for this and any other years.

Accepted Answer

The loss cannot be deducted this year si

Question 4

Beta Corporation recently purchased 100% of XYZ Corporation stock.You are their CPA.What tax issues need to be addressed before determining whether or not to file a consolidated tax return?

Accepted Answer

•Does either Beta or XYZ have losses?
•D

Question 5

What is probably the most common reason for making a consolidated return election?

Accepted Answer

Filing consolidated returns al

Question 6

Corporations may carry charitable contributions in excess of the income limitation forward for five years.

Accepted Answer

A) True 
 B)False

Question 7

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 8

What are start-up expenditures?

Accepted Answer

Start-up expenditures usually

Question 9

Grant Corporation is not a large corporation for estimated tax purposes and reports on a calendar-year basis.Grant expects the following results:
 
Grant's tax liability for last year was $240,000.Grant's minimum total estimated tax payment for this year to avoid a penalty is

Accepted Answer

A) $240,000. 
B) $248,000. 
C) $288,000. 
D) $280,000. 
A) $240,000. 
B) $248,000. 
C) $288,000. 
D) $280,000.

Question 10

Which of the following items is a temporary difference between tax income and financial accounting income?

Accepted Answer

A) production activities deduction 
B) proceeds on life insurance on a key executive 
C) dividends-received deduction 
D) depreciation 
A) production activities deduction 
B) proceeds on life insurance on a key executive 
C) dividends-received deduction 
D) depreciation

Question 11

Bright Corporation purchased residential real estate five years ago for $450,000,of which $50,000 was allocated to the land and $400,000 was allocated to the building.Bright booked straight-line MACRS deductions of $55,000 during the past five years.This year,Bright sells the property for $550,000,of which $100,000 is allocated to the land and $450,000 is allocated to the building.What is the amount and character of Bright's recognized gain or loss on the sale?

Accepted Answer

Bright recognizes $50,000 ($100,000 - $5

Question 12

All of the taxable income of a personal service corporation is taxed at a flat 35% rate.

Accepted Answer

A) True 
 B)False

Question 13

Vanda Corporation sold a truck with an adjusted basis of $50,000 to Barbara for $30,000.Vanessa owns 25% of the Vanda stock.What tax issues should Vanda and Vanessa consider with respect to the sale/purchase?

Accepted Answer

•What is Vanda Corporation's realized ga

Question 14

In February of the current year,Brent Corporation donates computer equipment that it purchased six months ago to Eastside High School for use in its educational program.The donated property had a $20,000 adjusted basis to Brent and a $40,000 FMV.What is the amount of the gift?

Accepted Answer

A) $20,000 
B) $30,000 
C) $35,000 
D) $50,000 
A) $20,000 
B) $30,000 
C) $35,000 
D) $50,000

Question 15

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

Accepted Answer

The correct order for taking deductions

Question 16

What impact does an NOL carryforward have on the proper sequencing of deductions to compute corporate taxable income?

Accepted Answer

The NOL deduction must be computed twice

Question 17

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 18

The U.S.production activities deduction is based on a percentage of which of the following?

Accepted Answer

A) taxable income before the production activities deduction 
B) 50% of W-2 wages. 
C) qualified production activities income 
D) both A and C above 
A) taxable income before the production activities deduction 
B) 50% of W-2 wages. 
C) qualified production activities income 
D) both A and C above

Question 19

Identify which of the following statements is false.

Accepted Answer

A) The 70% dividends-received deduction is limited to 70% of the taxable income of the corporation without regard to any NOL deduction,any capital loss carryback,and the dividends-received deduction itself unless the dividends-received deduction produces an NOL. 
B) Members of an affiliated group can claim a 90% dividends-received deduction for dividends received from other group members that is not subject to a taxable income limitation. 
C) A corporate dividends-received deduction is not allowed for dividends received on stock held for 40 days. 
D) All of the above are false. 
A) The 70% dividends-received deduction is limited to 70% of the taxable income of the corporation without regard to any NOL deduction,any capital loss carryback,and the dividends-received deduction itself unless the dividends-received deduction produces an NOL. 
B) Members of an affiliated group can claim a 90% dividends-received deduction for dividends received from other group members that is not subject to a taxable income limitation. 
C) A corporate dividends-received deduction is not allowed for dividends received on stock held for 40 days. 
D) All of the above are false.

Question 20

Glacier Corporation,a large retail sales company,has a taxable income of $20,000,000.What is Glacier Corporation's tax?

Accepted Answer

A) $6,800,000 
B) $7,000,000 
C) $7,800,000 
D) $7,200,000 
A) $6,800,000 
B) $7,000,000 
C) $7,800,000 
D) $7,200,000

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

Beta Corporation recently purchased 100% of XYZ Corporation stock.You are their CPA.What tax issues need to be addressed before determining whether or not to file a consolidated tax return?

What is probably the most common reason for making a consolidated return election?

Corporations may carry charitable contributions in excess of the income limitation forward for five years.

What are start-up expenditures?

Grant Corporation is not a large corporation for estimated tax purposes and reports on a calendar-year basis.Grant expects the following results: Grant's tax liability for last year was $240,000.Grant's minimum total estimated tax payment for this year to avoid a penalty is

Which of the following items is a temporary difference between tax income and financial accounting income?

All of the taxable income of a personal service corporation is taxed at a flat 35% rate.

Vanda Corporation sold a truck with an adjusted basis of $50,000 to Barbara for $30,000.Vanessa owns 25% of the Vanda stock.What tax issues should Vanda and Vanessa consider with respect to the sale/purchase?

In February of the current year,Brent Corporation donates computer equipment that it purchased six months ago to Eastside High School for use in its educational program.The donated property had a $20,000 adjusted basis to Brent and a $40,000 FMV.What is the amount of the gift?

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

What impact does an NOL carryforward have on the proper sequencing of deductions to compute corporate taxable income?

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?

The U.S.production activities deduction is based on a percentage of which of the following?

Identify which of the following statements is false.

Glacier Corporation,a large retail sales company,has a taxable income of $20,000,000.What is Glacier Corporation's tax?

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

Exam 3: The Corporate Income Tax

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

Beta Corporation recently purchased 100% of XYZ Corporation stock.You are their CPA.What tax issues need to be addressed before determining whether or not to file a consolidated tax return?

What is probably the most common reason for making a consolidated return election?

Corporations may carry charitable contributions in excess of the income limitation forward for five years.

What are start-up expenditures?

Grant Corporation is not a large corporation for estimated tax purposes and reports on a calendar-year basis.Grant expects the following results: Grant's tax liability for last year was $240,000.Grant's minimum total estimated tax payment for this year to avoid a penalty is

Which of the following items is a temporary difference between tax income and financial accounting income?

All of the taxable income of a personal service corporation is taxed at a flat 35% rate.

Vanda Corporation sold a truck with an adjusted basis of $50,000 to Barbara for $30,000.Vanessa owns 25% of the Vanda stock.What tax issues should Vanda and Vanessa consider with respect to the sale/purchase?

In February of the current year,Brent Corporation donates computer equipment that it purchased six months ago to Eastside High School for use in its educational program.The donated property had a $20,000 adjusted basis to Brent and a $40,000 FMV.What is the amount of the gift?

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

What impact does an NOL carryforward have on the proper sequencing of deductions to compute corporate taxable income?

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?

The U.S.production activities deduction is based on a percentage of which of the following?

Identify which of the following statements is false.

Glacier Corporation,a large retail sales company,has a taxable income of $20,000,000.What is Glacier Corporation's tax?

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