Question & Answer

What is the difference between a tax deduction and a tax credit?Is one more beneficial than the other?Explain.

How much flexibility do partnerships have in allocating partnership items to partners?

Explain how in 2022, the rising inflation and higher prices in the United States affected the demand for loanable funds, the supply of loanable funds, and interest rates in the United States (LO1)

The accounting records of Shinault Inc. show the following data for 2014 (its first year of operations). 1. Life insurance expense on officers was $9,000. 2. Equipment was acquired in early January for $300,000. Straight-line depreciation over a 5-year life is used, with no salvage value. For tax purposes, Shinault used a 30% rate to calculate depreciation. 3. Interest revenue on State of New York bonds totaled $4,000. 4. Product warranties were estimated to be $50,000 in 2014. Actual repair and labor costs related to the warranties in 2014 were $10,000. The remainder is estimated to be paid evenly in 2015 and 2016. 5. Gross profit on an accrual basis was $100,000. For tax purposes, $75,000 was recorded on the installment- sales method. 6. Fines incurred for pollution violations were $4,200. 7. Pretax financial income was $750,000. The tax rate is 30%. Instructions (a) Prepare a schedule starting with pretax financial income in 2014 and ending with taxable income in 2014. (b) Prepare the journal entry for 2014 to record income taxes payable, income tax expense, and deferred  income taxes.

: If Henry is passed over for promotion, what feedback and advice should he be given about how to improve his management skills for possible future promotions?

What stock ownership tests must be met before a shareholder receives exchange treatment under the substantially disproportionate change-in-stock-ownership test in a stock redemption?  Why is a change-in-stock-ownership test used to determine the tax status of a stock redemption?

In processes involving pipeline operations or assembly line operations, if the pipeline or assembly line is always full, then beginning and ending WIP inventories are always 50 per cent complete with regard to conversion costs. Explain.

This year, Janelle received $200,000 in life insurance proceeds. Under the following scenarios, how much of the $200,000 is taxable?

Question: What is stare decisis and how does it relate to the Golsen rule?

Compare and contrast the aggregate and entity concepts for taxing partnerships and their partners.

Describe the doctor-blade process.

Presented below is an excerpt from the financial statements of H. J. Heinz Company. Segment and Geographic Data The company is engaged principally in one line of business—processed food products—which represents over 90% of consolidated sales. Information about the business of the company by geographic area is presented in the table below. There were no material amounts of sales or transfers between geographic areas or between affi liates, and no material amounts of United States export sales. Foreign (in thousands of United Western U.S. dollars) Domestic Kingdom Canada Europe Other Total Worldwide Sales $2,381,054 $547,527 $216,726 $383,784 $209,354 $1,357,391 $3,738,445 Operating income 246,780 61,282 34,146 29,146 25,111 149,685 396,465 Identifi able assets 1,362,152 265,218 112,620 294,732 143,971 816,541 2,178,693 Capital expenditures 72,712 12,262 13,790 8,253 4,368 38,673 111,385 Depreciation expense 42,279 8,364 3,592 6,355 3,606 21,917 64,196 Instructions (a) Why does H. J. Heinz not prepare segment information on its products or services? (b) What are export sales, and when should they be disclosed? (c) Why are sales by geographical area important to disclose?

Cost function and assumptions Express Lunch is a small food van that sells a variety of sandwiches and beverages. Total fixed costs are $20 000 per month. Last month total variable costs were $8000 when total sales were $32 000.   Required (a)          Write out the algebraic expression for the cost function. (b)          What assumptions do we make when we develop this cost function?

On January 1, 2024, Janna has a tax basis of $15,000 in her Mimikaki stock (Mimikaki has been an S corporation since inception). In 2024, Janna was allocated $20,000 of ordinary income from Mimikaki. What are the amount and character of gain she recognizes from end-of-the-year distributions in each of the following alternative scenarios, and what is her stock basis following each distribution?

The downsprue leading into the runner of a certain mold has a length = 175 mm. The cross-sectional area at the base of the sprue is 400 mm2 . The mold cavity has a volume = 0.001 m3 . Determine (a) the velocity of the molten metal flowing through the base of the downsprue, (b) the volume rate of flow, and (c) the time required to fill the mold cavity

An experimental power source for spot welding is designed to deliver current as a ramp function of time: I = 100,000 t, where I = amp and t = sec. At the end of the power-on time, the current is stopped abruptly. The sheet metal being spot welded is low carbon steel whose unit melting energy = 10 J/mm3. The resistance R = 85 micro-ohms. The desired weld nugget diameter = 4 mm and thickness = 2 mm (assume a disc-shaped nugget). It is assumed that 1/4 of the energy generated from the power source will be used to form the weld nugget. Determine the power-on time the current must be applied in order to perform this spot-welding operation.

What are the two ways in which a bank should diversify its loans? Why? Is international diversification of loans a viable strategy for dealing with credit risk? Defend your answer. (LO4)

On June 1, year 1, Jasper Corporation’s S election was involuntarily terminated.  What is the earliest Jasper may be taxed as an S corporation again?  Are there any exceptions to the general rule?  Explain.

Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1, 2014. Each employee covered by the plan is entitled to a pension payment each year after retirement. As required by accounting  tandards, the controller of the company needs to report the pension obligation (liability). On the basis of a discussion with the supervisor of the Personnel Department and an actuary from an insurance company, the controller develops the following information related to the pension plan. Average length of time to retirement 15 years Expected life duration after retirement 10 years Total pension payment expected each year after retirement for all employees. Payment made at the end of the year. $700,000 per year The interest rate to be used is 8%. Instructions On the basis of the information above, determine the present value of the pension obligation (liability).

An electric discharge machining operation is being performed on two work materials: tungsten and tin. Determine the amount of metal removed in the operation after one hour at a discharge current of 20 amps for each of these metals. Use metric units and express the answers in mm3/hr. From Table 4.1, the melting temperatures of tungsten and tin are 3410°C and 232°C, respectively.

Anne purchased an annuity from an insurance company that promised to pay her $20,000 per year for the next 10 years. Anne paid $145,000 for the annuity, and in exchange she will receive $200,000 over the term of the annuity.

Describe the relation between the book-tax differences associated with depreciation expense and the book-tax differences associated with gain or loss on disposition of depreciable assets.

Mohave Inc. purchased land, building, and equipment from Laguna Corporation for a cash payment of $315,000. The estimated fair values of the assets are land $60,000, building $220,000, and equipment $80,000. At what amounts should each of the three assets be recorded?

Amelie, a retired physician, is 66 years old. Determine her standard deduction in 2024 under the following scenarios. a. Amelie is married to Roget, age 52, and they file married filing jointly. b. Amelie is not married. c. Amelie is not married and her 10-year-old granddaughter, Emma, lives with her. Amelie supports Emma and claims her as a dependent.

How are small and medium-sized finance companies able to issue commercial paper? Why do some well-known finance companies directly place their commercial paper? (LO2)