Question 1

Separately stated items are listed on Schedule _________________________ of the Form 1120S.

Accepted Answer

The answer of Separately stated items are listed on Schedule...

Question 2

Samantha owned 1,000 shares in Evita, Inc., an S corporation, that uses the calendar year. On October 11, 2012, Samantha sells all of her Evita stock. Her basis at the beginning of 2012 was $60,000. Her share of the corporate income for 2012 was $22,000, and she receives a distribution of $35,000 between January 1 and October 11, 2012. Her stock basis at the time of the sale is:

Accepted Answer

A) $117,000. 
B) $82,000. 
C) $60,000. 
D) $47,000. 
A) $117,000. 
B) $82,000. 
C) $60,000. 
D) $47,000.

Question 3

Which statement is incorrect?

Accepted Answer

A) S corporation status allows shareholders to realize tax benefits from corporate losses immediately. 
B) Shareholder-level tax on corporate profits can be eliminated by a step-up in the basis of the stock upon a shareholder's death. 
C) Fewer than 50% of all U.S.corporations make the S election. 
D) An S corporation resembles an LLC for Federal income tax purposes. 
E) None of the above. 
A) S corporation status allows shareholders to realize tax benefits from corporate losses immediately. 
B) Shareholder-level tax on corporate profits can be eliminated by a step-up in the basis of the stock upon a shareholder's death. 
C) Fewer than 50% of all U.S.corporations make the S election. 
D) An S corporation resembles an LLC for Federal income tax purposes. 
E) None of the above.

Question 4

Rents always are considered to be passive investment income in S status.

Accepted Answer

A) True 
 B)False

Question 5

Distributions of which assets during an S corporation's post-termination period receive favorable income tax treatment?

Accepted Answer

A) Cash. 
B) Investment portfolio. 
C) Real estate. 
D) Notes receivable. 
A) Cash. 
B) Investment portfolio. 
C) Real estate. 
D) Notes receivable.

Question 6

An S corporation's separately stated items generally are identical to those separately stated by _________________________.

Accepted Answer

The answer of An S corporation's separately stated items generally...

Question 7

For Federal income tax purposes, taxation of S corporations resembles that of partnerships.

Accepted Answer

A) True 
 B)False

Question 8

Beginning in 2012, Ewing, Inc., an S corporation, holds a AAA balance of $695,100.During the year, the following items occur.   Ewing's ending AAA balance is:

Accepted Answer

A) $1,104,250. 
B) $1,110,250. 
C) $1,123,250. 
D) $1,180,250. 
A) $1,104,250. 
B) $1,110,250. 
C) $1,123,250. 
D) $1,180,250.

Question 9

The alternative minimum tax applies to an S corporation.

Accepted Answer

A) True 
 B)False

Question 10

How large must total assets on Schedule L be at the end of the year for an S corporation to be required to file Schedule M-3?

Accepted Answer

A) $1 million. 
B) $5 million. 
C) $10 million. 
D) $100 million. 
A) $1 million. 
B) $5 million. 
C) $10 million. 
D) $100 million.

Question 11

No maximum or minimum dollar sales or capitalization restrictions apply to S corporations.

Accepted Answer

A) True 
 B)False

Question 12

Tax-exempt income is listed on Schedule ____________________ of Form 1120S.

Accepted Answer

The answer of Tax-exempt income is listed on Schedule ____________________...

Question 13

Which, if any, of the following can be an eligible shareholder of an S corporation?

Accepted Answer

A) A child, age 10. 
B) A resident alien. 
C) A voting trust. 
D) The estate of a deceased shareholder. 
E) All of the above can own S stock. 
A) A child, age 10. 
B) A resident alien. 
C) A voting trust. 
D) The estate of a deceased shareholder. 
E) All of the above can own S stock.

Question 14

An S shareholder who dies during the corporate tax year must report his or her share of the pro rata income (or loss) up to the date of death on the final individual tax return.

Accepted Answer

A) True 
 B)False

Question 15

A distribution from OAA is not taxable.

Accepted Answer

A) True 
 B)False

Question 16

With respect to passive losses, there are three classes of income, losses, and credits: ____________________, ____________________, and passive.
or

Accepted Answer

active, po

Question 17

You are given the following facts about a one-shareholder S corporation. Prepare the shareholder's ending stock basis.

Accepted Answer

A) $168,660. 
B) $192,850. 
C) $214,960. 
D) $263,960. 
A) $168,660. 
B) $192,850. 
C) $214,960. 
D) $263,960.

Question 18

An S corporation's LIFO recapture amount equals the excess of the inventory's value under ____________________ over the ____________________ value.

Accepted Answer

The answer of An S corporation's LIFO recapture amount equals...

Question 19

On January 1, Bobby and Alice own equally all of the stock of an electing S corporation called Prairie Dirt Delight.The dirt company has a $60,000 loss for a non-leap year.On the 200th day of the year, Bobby sells his one-half of the stock to his son, Saul.How much of the $60,000 loss, if any, is allocated to Bobby?

Accepted Answer

A) $0. 
B) $13,562. 
C) $16,438. 
D) $32,877. 
A) $0. 
B) $13,562. 
C) $16,438. 
D) $32,877.

Question 20

Which item does not appear on Schedule K of Form 1120S?

Accepted Answer

A) Intangible drilling costs. 
B) Foreign loss. 
C) Utilities expense. 
D) Recovery of a tax benefit. 
E) All of the above items appear on Schedule K. 
A) Intangible drilling costs. 
B) Foreign loss. 
C) Utilities expense. 
D) Recovery of a tax benefit. 
E) All of the above items appear on Schedule K.

Exam 22: S: Corporations

Separately stated items are listed on Schedule _________________________ of the Form 1120S.

Which statement is incorrect?

Rents always are considered to be passive investment income in S status.

Distributions of which assets during an S corporation's post-termination period receive favorable income tax treatment?

An S corporation's separately stated items generally are identical to those separately stated by _________________________.

For Federal income tax purposes, taxation of S corporations resembles that of partnerships.

Beginning in 2012, Ewing, Inc., an S corporation, holds a AAA balance of $695,100.During the year, the following items occur. Ewing's ending AAA balance is:

The alternative minimum tax applies to an S corporation.

How large must total assets on Schedule L be at the end of the year for an S corporation to be required to file Schedule M-3?

No maximum or minimum dollar sales or capitalization restrictions apply to S corporations.

Tax-exempt income is listed on Schedule ____________________ of Form 1120S.

Which, if any, of the following can be an eligible shareholder of an S corporation?

An S shareholder who dies during the corporate tax year must report his or her share of the pro rata income (or loss) up to the date of death on the final individual tax return.

A distribution from OAA is not taxable.

With respect to passive losses, there are three classes of income, losses, and credits: ____________________, ____________________, and passive. or

You are given the following facts about a one-shareholder S corporation. Prepare the shareholder's ending stock basis.

An S corporation's LIFO recapture amount equals the excess of the inventory's value under ____________________ over the ____________________ value.

Which item does not appear on Schedule K of Form 1120S?

An Introduction to Taxation and Understanding the Federal Tax Law

Working With the Tax Law

Computing the Tax

Gross Income: Concepts and Inclusions

Gross Income: Exclusions

Deductions and Losses: in General

Deductions and Losses: Certain Business Expenses and Losses

Depreciation, Cost Recovery, Amortization, and Depletion

Deductions: Employee and Self-Employed-Related Expenses

Deductions and Losses: Certain Itemized Deductions

Investor Losses

Tax Credits and Payments

Property Transactions: Determination of Gain or Loss, Basis Considerations, and Nontaxable Exchanges-Part 1

Property Transactions: Determination of Gain or Loss, Basis Considerations, and Nontaxable Exchanges-Part 2

Property Transactions: Capital Gains and Losses, 1231, Recapture Provisions

Alternative Minimum Tax

Accounting Periods and Methods

Corporations: Introduction and Operating Rules

Corporations: Organization and Capital Structure

Corporations: Distributions Not in Complete Liquidation

Corporations: Distributions in Complete Liquidation and an Overview of Reorganizations

Partnerships

Exempt Entities

Multistate Corporate Taxation

Taxation of International Transactions

Tax Practice and Ethics

Income Taxation of Trusts and Estates

Filters

With respect to passive losses, there are three classes of income, losses, and credits: , , and passive. or

An S corporation's LIFO recapture amount equals the excess of the inventory's value under over the value.