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Cristine?s boss gave her two tickets to the Justin Beaber

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Cristine?s boss gave her two tickets to the Justin Beaber concert because she met her sales quota. At the time Cristine received the two tickets, they had a face value of $100 each and were selling on eBay for $300 each (which equaled the fair market value of the tickets). On the date of the concert, the tickets were selling for $300 each. Cristine and her daughter (Jeanette) attended the concert. How much gross income should Cristine report as a result of the tickets?;a. $0;b. $200;c. $400;d. $600;42. Sagi was a professional soccer player before a career-ending injury caused by a grossly negligent driver. Sagi sued the driver and collected $1 million as compensation for lost estimated future income and $2 million for punitive damages. How much gross income should Sagi report as a result of the damages he received?;a. $0;b. $1 million;c. $2 million;d. $3 million;43. Which of the following is a deduction FROM AGI?;a. Ellice paid alimony to a former spouse;b. Pamela invested $3,000 in a Roth IRA;c. Stephanie paid real estate taxes levied by the county on her personal residence;d. Monica paid property taxes levied by the county on her car used exclusively for business;44. Compute the casualty loss on Amy?s uninsured rental property under the following facts;Adjusted basis $100,000;FMV before the loss $75,000;FMV after the loss $0;a. N/A (we need to know Amy?s AGI to answer this question);b. $100,000;c. $75,000;d. $25,000;45. Crucilena Corporation acquired new computer equipment on March 13, 2014, for $50,000. Crucilena did not elect immediate expensing under Section 179. Determine Crucilena?s cost recovery for 2014.;a. $50,000;b. $20,000;c. $10,000;d. $0;46. On August 5, 2014, Kathryn purchased a new office building for $5 million. On October 3, 2014, she began to rent out office space in the building. What is Kathryn?s cost recovery for 2014?;a. $0;b. $26,750;c. $128,200;d. $5,000,000;47. Assume the same facts as in the previous problem. Assume further that Kathryn sells the office building on July 12, 2018. What is Kathryn?s cost recovery for 2018?;a. $0;b. $69,442;c. $128,200;d. $1,000,000;48. Jeff performs services for Nova Corporation. In determining whether Jeff is an employee or an independent contractor, which factor is MOST likely to suggest that Jeff is an employee?;a. Nova Corporation determines the details of HOW Jeff performs the applicable work;b. Jeff uses his own tools;c. Jeff sets his own schedule;d. Jeff performs the services from his home;BACKGROUND INFORMATION FOR QUESTIONS 49-50 Yessenia and Olga recently formed a corporation named YO! Inc. (or ?YO!?). On December 31, 2012, YO! issued 800,000 shares of common stock to Olga and 800,000 shares of common stock to Yessenia. Olga and Yessenia each paid $0.01 per share for their stock ($0.01 equaled the per share fair market value on December 31, 2012). Their stock is subject to a 4-year ?repurchase option? (at cost) in favor of YO!. Each YO! repurchase option will ?lapse? over time so that on December 31 (of 2013, 2014, 2015 and 2016), 200,000 shares will be released from the repurchase option. For example, if Olga quits YO! before December 31, 2016, YO! can repurchase Olga?s ?unvested shares? for $0.01 per share (no matter what the fair market value is on that date).;49. Assume that Tim DID NOT file a timely ?83(b) election.? On December 31, 2014, Tim is still working at TJ and thus 200,000 of Tim?s 800,000 shares are ?released? from the TJ repurchase option (i.e., 200,000 of Tim?s shares ?vest? on December 31, 2014). On that same day, the fair market value of the TJ stock equals $10.01 per share. What 2014income, if any, must Tim report as a result of these events?;a. $8,000,000;b. $2,002,000;c. $2,000,000;d. $0;50. Assume that Jonathan DID file a timely ?83(b) election.? On December 31, 2014, Jonathan is also still working at TJ and thus 200,000 of Jonathan?s 800,000 shares are also ?released? from the TJ repurchase option (i.e., 200,000 of Jonathan?s shares ?vest? on December 31, 2014). On that same day, the fair market value of the TJ stock equals $10.01 per share. What 2014 income, if any, must Jonathan report as a result of these events?;a. $8,000,000;b. $2,002,000;c. $2,000,000;d. $0

 

Paper#19635 | Written in 18-Jul-2015

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