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Identify which of the following statements is true. a. A transferor?s gain or loss that goes unrecognized when Sec. 351




Question;11.Identify;which of the following statements is true. a. A transferor?s gain or loss that;goes unrecognized when Sec. 351 applies is permanently exempt for taxation b. If a taxpayer transfers property and;services as part of a transaction meeting the?Sec. 351 requirements, all of the;stock received is counted in determining whether the property transferors have;acquired control. c. If a taxpayer transfers property and services as part;of a transaction meeting the Sec. 351 requirements, the nonrecognition?of gain;or loss will apply to the services d. All are false;12.;Matt and Sheila form Krupp Corporation. Matt contributes property with a FMV of;$55,000 and a basis of $35,000. Sheila contributes property with a FMV of;$75,000 and a basis of $40,000. Matt sells?his stock to Paul shortly after the;exchange. The transaction will a. Qualify under Sec. 351 only if an advantage;ruling has been obtained b. Qualify with respect to Sheila under Sec. 351;whether Matt qualifies or not c. Not qualify under Sec. 351 d. Qualify?under Sec. 351 if Matt can show;the sale to Paul was not part of a prearranged plan;13.;A new corporation may generally select one of the following accounting methods;with the exception of a. Hybrid method b.;Retail method c. Cash method d. Accrual method?;14.Once;a corporation has a taxable year it can change the taxable year without IRS;permission if a. The resulting short period does not have a net operating loss;b. The corporation has not changed its accounting period within the last 10;years c. The annualized?income for the short period is at least 80% of the;corporation?s income for the preceding taxable year d. All of these;15.;Identify which of the following statements is false a. A corporation?s first;tax year may not cover a full 12-month period b. A new corporation?can elect a fiscal year that runs from February 16;to February 15 of the following year c. A corporation?s fiscal year;generally must end on the last day of the month d. A fiscal year may not end on;December 31;16.Richards;Corporation has taxable income of?$280,000 calculated before the charitable;contribution deduction and before its dividends-received deduction of $34,000.;Richards makes cash contributions of $35,000 to charitable organizations. What;is Richards Corporation?s charitable contribution deduction?for the current;year? a. $35,000 b. $31,400 c. $24,600 d.;$28,000;17.Green;Corporation is incorporated on March 1 and beings business on June 1. Green?s;first tax year ends on October 31, i.e., a short year. Green incurs the;following expenses during the year:?Date Type Amount February Draft charter $;2,000 March Stock commission 30,000 March Accounting fees to set up books 2,000;April Temporary director fees 2,000 December Charter modification fee 1,000 What;is the deduction for organizational expenses if Green?chooses to deduct its;costs as soon as possible? a. $667 b.;$5,028 c. $500 d. $36,000;18.;Island Corporation has the following income and expense items for the year.;Gross receipts from sales $60,000 Dividends received from 15%-owned domestic;corporation 40,000?Expenses connected with sales 30,000 The taxable income of;Island Corporation is a.$47,000 b.$70,000 c.$42,000;d.$100,000;19Which;of the following is not an adjustment in calculating AMTI? a. Production;activities deduction b. The regular tax NOL deduction?c. The difference between;the gains for AMTI and regular tax purposes d. Gain on installment sales of noninventory property;20.Which;of the following items are adjustments made to arrive at alternative minimum;taxable income? a. Tax-exempt interest income?earned on private activity bonds b. Excess of depreciation claimed on;personally acquired in the current year for taxable income purposes over that;claimed for alternative minimum tax purposes c. Statutory exemption d.;Excess percentage depletion


Paper#52005 | Written in 18-Jul-2015

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