Details of this Paper

Accounting

Description

solution


Question

Question;5. Upon the;recommendation of a physician, Joshua has a dust elimination system installed;in his personal residence. He suffers;from severe allergies. In connection;with this system, Joshua incurs and pays the following amounts during the;current year;Dust;elimination system and cost of installation $7,000;Increase;in utility bills due to the system 400;Cost;of certified appraisal 500;The;system has an estimated useful life of 5 years.;The appraisal was to determine the value of Joshua's residence with and;without the system. The appraisal states;that the system increased the value of Joshua's residence by $3,000. Disregarding percentage limitations, how much;of the above expenditures qualify for the medical expense deduction in the;current year?;a. $7,900.;b. $7,400.;c. $4,500.;d. $4,400.;e. None of the above.;6. In 2010;Aaron pays $3,000 to become a charter member of Western University?s Athletic;Council. The membership ensures that;Aaron will receive choice seating at all of Western?s home football games. Also in 2010, Aaron pays $600 (the regular;retail price) for season tickets for himself and his wife. For these items, how much qualifies as a;charitable contribution?;a. $0.;b. $600.;c. $2,400.;d. $3,000.;e. None of the above.;7. Eric owns;five activities. He elects not to group;them together as a single activity under the "appropriate economic;unit" standard. He participates for;100 hours in Activity A, 140 hours in Activity B, 240 hours in Activity C, 99;hours in Activity D, and 120 hours in Activity E. Which of the following statements is correct?;a. Eric is a material participant with respect;to Activities A, B, C, D, and E.;b. Eric is a material participant with respect;to Activities B, C, and E only.;c. Activities A, B, C, D and E are all;significant participation activities.;d. Activities B, C and E are all significant;participation activities.;e. None of the above.;8. Wanda owns;four separate activities. She elects not;to group them together as a single activity under the ?appropriate economic;unit? standard. Wanda participates for;111 hours in Activity A, 155 hours in Activity B, 115 hours in Activity C, and;120 hours in Activity D. She has one;employee, who works 400 hours in Activity D.;Which of the following statements is incorrect?;a. Losses from all of the activities can be;used to offset Wanda?s active income.;b. Wanda is a material participant with respect;to Activities A, B, C, and D.;c. Wanda is a material participant with respect;to only Activity D.;d. Activities A, B, C, and D are all;significant participation activities.;e. None of the above statements is correct.;9. Sally sells a;passive activity with an adjusted basis of $145,000 for $225,000. Suspended losses attributable to this;property total $35,000. The total gain;and the taxable gain are;a. $80,000 total gain, $80,000 taxable;gain.;b. $45,000 total gain, $45,000 taxable;gain.;c. $80,000 total gain, $0 taxable gain.;d. $80,000 total gain, $45,000 taxable;gain.;e. None of the above.;10. Sycamore Corporation, a closely held;nonpersonal service corporation, has $300,000 of passive losses, $240,000 of;active business income, and $40,000 of portfolio income. How much of the passive loss may Sycamore;Corporation deduct?;a. $0.;b. $40,000.;c. $240,000.;d. $300,000.;e. None of the above.;11. Andrew, who is single, has $95,000 of salary;$60,000 of income from a limited partnership, and a $79,000 passive loss from a;real estate rental activity in which he actively participates. His modified adjusted gross income is;$95,000. Of the $79,000 loss, how much;is deductible?;a. $-0-.;b. $19,000.;c. $25,000.;d. $79,000.;e. None of the above.;12. Paul;owns five activities. He elects not to;group them together as a single activity under the "appropriate economic;unit" standard. He participates for;100 hours in Activity A, 145 hours in Activity B, 125 hours in Activity C, 105;hours in Activity D, and 126 hours in Activity E. Which of the following statements is correct?;a. Activities;A, B, C, and E are all significant participation activities.;b. Paul is a material participant with respect;to Activities B, C, D, and E only.;c.;Paul;is a material participant with respect to Activities A, B, C, D, and E.;d. Activities A, B, C, D and E are all significant participation;activities.;e. None of the above.

 

Paper#41672 | Written in 18-Jul-2015

Price : $27
SiteLock