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Under the uniform capitalization rules applicable to property acquired for resale, which of the following costs should be capitalized with respect to inventory if no exceptions are met?
Under the uniform capitalization rules applicable to property acquired for resale, which of the following costs should be capitalized with respect to inventory if no exceptions are met? A . Option A B. Option B C. Option C D. Option DView AnswerAnswer: D Explanation: Choice "d" is correct. Under the...
What amount should Rich report as net self-employment income?
Rich is a cash basis self-employed air-conditioning repairman with 1993 gross business receipts of $20,000. Rich's cash disbursements were as follows: What amount should Rich report as net self-employment income? A. $15,100 B. $14,900 C. $14,100 D. $13,900View AnswerAnswer: A Explanation: Choice "a" is correct. Deductions to arrive at net...
What amount of Freeman's income is subject to self-employment tax?
Freeman, a single individual, reported the following income in the current year: Guaranteed payment from services rendered to a partnership $50,000 Ordinary income from a S corporation $20,000 What amount of Freeman's income is subject to self-employment tax?A . $0 B. $20,000 C. $50,000 D. $70,000View AnswerAnswer: C Explanation: Choice...
In which of the following situations may taxpayers file as married filing jointly?
In which of the following situations may taxpayers file as married filing jointly?A . Taxpayers who were married but lived apart during the year. B. Taxpayers who were married but lived under a legal separation agreement at the end of the year. C. Taxpayers who were divorced during the year....
How much income should Hall include in his 1993 individual income tax return for the inheritance of the 500 shares of stock, which he received from his father's estate?
On February 1, 1993, Hall learned that he was bequeathed 500 shares of common stock under his father's will. Hall's father had paid $2,500 for the stock in 1990. Fair market value of the stock on February 1, 1993, the date of his father's death, was $4,000 and had increased...
What amount of interest was deductible on Michaels' 1993 income tax return?
On December 1, 1992, Michaels, a self-employed cash basis taxpayer, borrowed $100,000 to use in her business. The loan was to be repaid on November 30, 1993. Michaels paid the entire interest of $12,000 on December 1, 1992. What amount of interest was deductible on Michaels' 1993 income tax return?A...
What condition(s) must have been met for the award to be excluded from Kent's gross income?
DAC Foundation awarded Kent $75,000 in recognition of lifelong literary achievement. Kent was not required to render future services as a condition to receive the $75,000. What condition(s) must have been met for the award to be excluded from Kent's gross income? I. Kent was selected for the award by...
How much rental income (loss) is included in Barkley's adjusted gross income?
Barkley owns a vacation cabin that was rented to unrelated parties for 10 days during the year for $2,500. The cabin was used personally by Barkley for three months and left vacant for the rest of the year. Expenses for the cabin were as follows: Real estate taxes $1,000 Maintenance...
Which of the following statements is correct?
Adams owns a second residence that is used for both personal and rental purposes. During 2001, Adams used the second residence for 50 days and rented the residence for 200 days. Which of the following statements is correct?A . Depreciation may not be deducted on the property under any circumstances....
How many exemptions was Smith entitled to claim on his 19X4 tax return?
In 19X4, Smith, a divorced person, provided over one half the support for his widowed mother, Ruth, and his son, Clay, both of whom are U.S. citizens. During 19X4, Ruth did not live with Smith. She received $9,000 in Social Security benefits. Clay, a 25 year-old full-time graduate student, and...
