Question 1

If a corporation would like a Subchapter S election to be valid for the current year,a Form 2553 must be filed:

Accepted Answer

A) Before the 15th day of the third month of the current fiscal year. 
B) Before the 15th day of the fourth month of the current fiscal year. 
C) Before the 15th day of the third month of the current fiscal year or in the prior fiscal year. 
D) In the prior fiscal year. 
A) Before the 15th day of the third month of the current fiscal year. 
B) Before the 15th day of the fourth month of the current fiscal year. 
C) Before the 15th day of the third month of the current fiscal year or in the prior fiscal year. 
D) In the prior fiscal year.

Question 2

PQR Corporation has taxable income before DRD of $60,000 that includes a dividend of $10,000 from a large publicly-traded domestic corporation.What is the tax liability of PQR Corporation?

Accepted Answer

A) $10,000. 
B) $8,000. 
C) $8,250. 
D) $7,500. 
A) $10,000. 
B) $8,000. 
C) $8,250. 
D) $7,500.

Question 3

A corporation with a net capital gain will be taxed on that gain at preferential tax rates,similar to an individual.

Accepted Answer

A) True 
 B)False

Question 4

Kyung formed a corporation and owns all of the stock.He contributed property with a FMV of $90,000 and a basis of $85,000,and he received $15,000 cash from the corporation.Kyung's basis in his stock is:

Accepted Answer

A) $85,000. 
B) $75,000. 
C) $90,000. 
D) $70,000. 
A) $85,000. 
B) $75,000. 
C) $90,000. 
D) $70,000.

Question 5

QRS Corporation has a fiscal year-end that ends on September 30.It is required to make quarterly estimated payments.The first estimated payment will be due on the 15th of:

Accepted Answer

A) January. 
B) December. 
C) February. 
D) November. 
A) January. 
B) December. 
C) February. 
D) November.

Question 6

Which of the following items decrease basis for a stockholder of a Subchapter S corporation?

Accepted Answer

A) Charitable contributions. 
B) Net income. 
C) Loans from the shareholder to the corporation. 
D) Capital contributions. 
A) Charitable contributions. 
B) Net income. 
C) Loans from the shareholder to the corporation. 
D) Capital contributions.

Question 7

Large C corporations must use the accrual basis of accounting.

Accepted Answer

A) True 
 B)False

Question 8

Willow Corporation has book income of $300,000,which includes tax expense of $70,000.It reported a capital loss of $10,000,and tax-exempt municipal bond interest of $30,000.Willow's taxable income is:

Accepted Answer

A) $340,000. 
B) $280,000. 
C) $350,000. 
D) $250,000. 
A) $340,000. 
B) $280,000. 
C) $350,000. 
D) $250,000.

Question 9

Which of the following will disqualify a corporation from electing Subchapter S status?

Accepted Answer

A) The election form is signed by 80% of the shareholders. 
B) The corporation has 80 shareholders. 
C) The corporation has one class of stock. 
D) All shareholders are U.S.citizens except for 10% who are resident aliens. 
A) The election form is signed by 80% of the shareholders. 
B) The corporation has 80 shareholders. 
C) The corporation has one class of stock. 
D) All shareholders are U.S.citizens except for 10% who are resident aliens.

Question 10

Which of the following statements is incorrect?

Accepted Answer

A) Some corporations can use the cash-basis of accounting. 
B) A calendar year corporate tax return is due 3½ months after the end of the fiscal year. 
C) Corporations that own foreign subsidiaries cannot file a Form 1120. 
D) A corporation can choose a fiscal year-end of its choice when filing its first tax return. 
A) Some corporations can use the cash-basis of accounting. 
B) A calendar year corporate tax return is due 3½ months after the end of the fiscal year. 
C) Corporations that own foreign subsidiaries cannot file a Form 1120. 
D) A corporation can choose a fiscal year-end of its choice when filing its first tax return.

Question 11

All C corporations file their tax returns using a Form 1120.

Accepted Answer

A) True 
 B)False

Question 12

Corporations with total receipts and total assets less than $250,000 are not required to complete Schedule L or Schedule M-1.

Accepted Answer

A) True 
 B)False

Question 13

If a shareholder receives cash from a corporation in complete liquidation of his or her ownership interest and the cash received is less than the shareholder's basis in the stock,the shareholder will report a loss.

Accepted Answer

A) True 
 B)False

Question 14

What is the AMT exemption amount for a corporation with AMT income of $250,000?

Accepted Answer

A) $0. 
B) $40,000. 
C) $15,000. 
D) $25,000. 
A) $0. 
B) $40,000. 
C) $15,000. 
D) $25,000.

Question 15

Shauntae receives a distribution from a corporation in complete liquidation of his ownership interest.Shauntae could report a capital gain,but not a capital loss,from the distribution.

Accepted Answer

A) True 
 B)False

Question 16

If a domestic corporation receives a dividend from another domestic corporation,it is entitled to a dividends received deduction of 70%,80%,or 100%.

Accepted Answer

A) True 
 B)False

Question 17

Adjusted Gross Income for a corporation is equal to sales minus cost of goods sold.

Accepted Answer

A) True 
 B)False

Question 18

Grape Corporation makes a nonliquidating distribution of appreciated property to its shareholders.

Accepted Answer

A) The shareholders will report a gain. 
B) The shareholders will report dividend income equal to the basis of the property distributed. 
C) The corporation will report dividend expense equal to the fair value of the property distributed. 
D) The corporation will report a gain. 
A) The shareholders will report a gain. 
B) The shareholders will report dividend income equal to the basis of the property distributed. 
C) The corporation will report dividend expense equal to the fair value of the property distributed. 
D) The corporation will report a gain.

Question 19

A corporation must file Form 1120 2½ months after the end of its fiscal year.

Accepted Answer

A) True 
 B)False

Question 20

Blue Company has taxable income of $90,000 before charitable contributions.The company made a $10,000 cash contribution to the local university.What is the tax liability of the company for the year?

Accepted Answer

A) $22,250. 
B) $15,790. 
C) $18,850. 
D) $15,450. 
A) $22,250. 
B) $15,790. 
C) $18,850. 
D) $15,450.

If a corporation would like a Subchapter S election to be valid for the current year,a Form 2553 must be filed:

PQR Corporation has taxable income before DRD of $60,000 that includes a dividend of $10,000 from a large publicly-traded domestic corporation.What is the tax liability of PQR Corporation?

A corporation with a net capital gain will be taxed on that gain at preferential tax rates,similar to an individual.

Kyung formed a corporation and owns all of the stock.He contributed property with a FMV of $90,000 and a basis of $85,000,and he received $15,000 cash from the corporation.Kyung's basis in his stock is:

QRS Corporation has a fiscal year-end that ends on September 30.It is required to make quarterly estimated payments.The first estimated payment will be due on the 15^thof:

Which of the following items decrease basis for a stockholder of a Subchapter S corporation?

Large C corporations must use the accrual basis of accounting.

Willow Corporation has book income of $300,000,which includes tax expense of $70,000.It reported a capital loss of $10,000,and tax-exempt municipal bond interest of $30,000.Willow's taxable income is:

Which of the following will disqualify a corporation from electing Subchapter S status?

Which of the following statements is incorrect?

All C corporations file their tax returns using a Form 1120.

Corporations with total receipts and total assets less than $250,000 are not required to complete Schedule L or Schedule M-1.

If a shareholder receives cash from a corporation in complete liquidation of his or her ownership interest and the cash received is less than the shareholder's basis in the stock,the shareholder will report a loss.

What is the AMT exemption amount for a corporation with AMT income of $250,000?

Shauntae receives a distribution from a corporation in complete liquidation of his ownership interest.Shauntae could report a capital gain,but not a capital loss,from the distribution.

If a domestic corporation receives a dividend from another domestic corporation,it is entitled to a dividends received deduction of 70%,80%,or 100%.

Adjusted Gross Income for a corporation is equal to sales minus cost of goods sold.

Grape Corporation makes a nonliquidating distribution of appreciated property to its shareholders.

A corporation must file Form 1120 2½ months after the end of its fiscal year.

Blue Company has taxable income of $90,000 before charitable contributions.The company made a $10,000 cash contribution to the local university.What is the tax liability of the company for the year?

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Adjustments for Adjusted Gross Income

Itemized Deductions

Self-Employed Business Income Line 12 of Form 1040 and Schedule C

Capital Gains and Other Sales of Property Schedule D and Form 4797

Rental Property, royalties, and Income From Flow-Through Entities Line 17, form 1040, and Schedule E

Tax Credits Form 1040, lines 46 Through 54 and Lines 66a Through 73

Payroll Taxes

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Partnership Taxation

Filters

Exam 15: Corporate Taxation

If a corporation would like a Subchapter S election to be valid for the current year,a Form 2553 must be filed:

PQR Corporation has taxable income before DRD of $60,000 that includes a dividend of $10,000 from a large publicly-traded domestic corporation.What is the tax liability of PQR Corporation?

A corporation with a net capital gain will be taxed on that gain at preferential tax rates,similar to an individual.

Kyung formed a corporation and owns all of the stock.He contributed property with a FMV of $90,000 and a basis of $85,000,and he received $15,000 cash from the corporation.Kyung's basis in his stock is:

QRS Corporation has a fiscal year-end that ends on September 30.It is required to make quarterly estimated payments.The first estimated payment will be due on the 15th of:

Which of the following items decrease basis for a stockholder of a Subchapter S corporation?

Large C corporations must use the accrual basis of accounting.

Willow Corporation has book income of $300,000,which includes tax expense of $70,000.It reported a capital loss of $10,000,and tax-exempt municipal bond interest of $30,000.Willow's taxable income is:

Which of the following will disqualify a corporation from electing Subchapter S status?

Which of the following statements is incorrect?

All C corporations file their tax returns using a Form 1120.

Corporations with total receipts and total assets less than $250,000 are not required to complete Schedule L or Schedule M-1.

If a shareholder receives cash from a corporation in complete liquidation of his or her ownership interest and the cash received is less than the shareholder's basis in the stock,the shareholder will report a loss.

What is the AMT exemption amount for a corporation with AMT income of $250,000?

Shauntae receives a distribution from a corporation in complete liquidation of his ownership interest.Shauntae could report a capital gain,but not a capital loss,from the distribution.

If a domestic corporation receives a dividend from another domestic corporation,it is entitled to a dividends received deduction of 70%,80%,or 100%.

Adjusted Gross Income for a corporation is equal to sales minus cost of goods sold.

Grape Corporation makes a nonliquidating distribution of appreciated property to its shareholders.

A corporation must file Form 1120 2½ months after the end of its fiscal year.

Blue Company has taxable income of $90,000 before charitable contributions.The company made a $10,000 cash contribution to the local university.What is the tax liability of the company for the year?

Introduction to Taxation, the Income Tax Formula, and Form 1040ez

Expanded Tax Formula, forms 1040a and 1040, and Basic Concepts

Gross Income: Inclusions and Exclusions

Adjustments for Adjusted Gross Income

Itemized Deductions

Self-Employed Business Income Line 12 of Form 1040 and Schedule C

Capital Gains and Other Sales of Property Schedule D and Form 4797

Rental Property, royalties, and Income From Flow-Through Entities Line 17, form 1040, and Schedule E

Tax Credits Form 1040, lines 46 Through 54 and Lines 66a Through 73

Payroll Taxes

Retirement and Other Tax-Deferred Plans and Annuities

Special Property Transactions

At-Riskpassive Activity Loss Rules and the Individual Alternative Minimum Tax

Partnership Taxation

Filters

QRS Corporation has a fiscal year-end that ends on September 30.It is required to make quarterly estimated payments.The first estimated payment will be due on the 15^thof: