Question & Answer

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.

Grady received $8,200 of Social Security benefits this year.  Grady also reported salary and interest income this year.  What amount of the benefits must Grady include in his gross income under the following two independent situations? a.       Grady files single and reports salary of $12,100 and interest income of $250. b.       Grady files single and reports salary of $22,000 and interest income of $600. c.       Grady files married joint and reports salary of $75,000 and interest income of $500. d.       Grady files married joint and reports salary of $44,000 and interest income of $700. e.            Grady files married separate and reports salary of $22,000 and interest income of $600

What is flash in die casting?

What are the advantages and disadvantages for a developing country of pursuing a policy of ISI?

Meyer reported the following pretax financial income (loss) for the years 2012–2016. 2012 $240,000 2013 350,000 2014 120,000 2015 (570,000) 2016 180,000 Pretax financial income (loss) and taxable income (loss) were the same for all years involved. The enacted tax rate was 34% for 2012 and 2013, and 40% for 2014–2016. Assume the carryback provision is used first for net operating losses. Instructions (a) Prepare the journal entries for the years 2014–2016 to record income tax expense, income taxes payable (refundable), and the tax effects of the loss carryback and loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-fifth of the benefits of the loss carryforward will not be realized. (b) Prepare the income tax section of the 2015 income statement beginning with the line “Income (loss) before income taxes.”

Think of three examples of monopolies (local or national) and consider how contestable their markets are.

MACRS depreciation requires the use of a recovery period, method, and convention to depreciate tangible personal property assets. Briefly explain why each is important to the calculation.

How do shaping and planing differ?

Should large securities firms be allowed to be independent and insulated from bank regulation, or should they be required to register as bank holding companies, and subject to bank regulations? Write a short essay that supports your opinion.

A batch of annealed steel has just been received from the vendor. It is supposed to have a tensile strength in the range 60,000 - 70,000 lb/in2 . A Brinell hardness test in the receiving department yields a value of HB = 118. (a) Does the steel meet the specification on tensile strength? (b) Estimate the yield strength of the material.

What function is served by tempering?

Yong recently paid his accountant $10,000 for elaborate tax planning strategies that exploit the timing strategy. Assuming this is an election year and there could be a power shift in the White House and Congress, what is a potential risk associated with Yong’s strategies?

Briefly describe some of the similarities and differences between GAAP and IFRS with respect to the accounting for leases.

Latrell recently used his Delta Skymiles to purchase a free round-trip ticket to Milan, Italy (value $1,200).  The frequent flyer miles used to purchase the ticket were generated from Latrell’s business travel as a CPA.  Latrell’s employer paid for his business trips, and he was not taxed on the travel reimbursement.     a.  Use an available tax research service to determine how much income, if any, Latrell will have to recognize as a result of purchasing an airline ticket with Skymiles earned from business travel.   b.  Write a memo communicating the results of your research.

Trevor is a single individual who is a cash-method, calendar-year taxpayer. For each of the next two years (2024 and 2025), Trevor expects to report salary of $80,000, contribute $8,000 to charity, and pay $2,800 in state income taxes. a. Estimate Trevor’s taxable income for 2024 and 2025 using the 2024 amounts for the standard deduction for both years. b. Now assume that Trevor combines his anticipated charitable contributions for the next two years and makes the combined contribution in December of 2024. Estimate Trevor’s taxable income for each of the next two years using the 2024 amounts for the standard deduction. Reconcile the total taxable income to your solution to part (a). c. Trevor plans to purchase a residence next year, and he estimates that additional property taxes and residential interest will cost $2,000 and $12,000, respectively, each year. Estimate Trevor’s taxable income for each of the next two years (2024 and 2025) using the 2024 amounts for the standard deduction and also assuming Trevor makes the charitable contribution of $8,000 and state tax payments of $2,800 in each year. d. Assume the facts in part (c) but that Trevor makes the charitable contribution for 2025 in December of 2024. Estimate Trevor’s taxable income for 2024 and 2025 using the 2024 amounts for the standard deduction. Reconcile the total taxable income to your solution to part (c). e. Explain the conditions in which the bunching strategy in part (d) will generate tax savings for Trevor.

Will Smith will receive $80,000 on December 31, 2019 (5 years from now), from a trust fund established by his father. Assuming the appropriate interest rate for discounting is 12% (compounded semiannually), what is the present value of this amount today?

Many London councils now have residents’ street parking permits, with charges that vary according to the carbon emissions of the registered vehicle. Explain the thinking behind this policy.

1.       : Psychologists have identified three pathways to happiness: pleasure, engagement, and meaning. Do you think it is the manager’s responsibility to help people find these elements in their work? Discuss.

Jim purchased 100 shares of stock this year and elected to participate in a dividend reinvestment program. This program automatically uses dividends to purchase additional shares of stock. This year Jim’s shares paid $350 of dividends, and these funds were used to purchase additional shares of stock. These additional shares are worth $375 at year-end. What amount of dividends, if any, should Jim declare as income this year? Explain.

Approximately what percentage of tax returns does the IRS audit?  What are the implications of this number for the IRS’s strategy in selecting returns for audit?

Faith Battle operates a health food store, and she has been the only employee. Her business is growing, and she is considering hiring some additional staff to help her in the store. Explain to her the various payroll deductions that she will have to account for, including their potential impact on her financial statements, if she hires additional staff.

Katie recently won a ceramic dalmatian valued at $800 on a television game show.  She questions whether this prize is taxable because it was a “gift” she won on the show.     a.  Use an available tax research service to answer Katie’s question.   b.  Write a letter to Katie communicating the results of your research.

If increased investment (using current technology) does not lead to increased long-run economic growth, does it bring any benefits?

What is the rationale for requiring partners to defer most gains and all losses when they contribute property to a partnership?

Since fixed-rate mortgages and bonds have similar payment flows, how is a financial institution with a large portfolio of fixed-rate mortgages affected by rising interest rates? Explain. LO(8-1)