Details of this Paper

Law question data bank




Question;1543. TF #1;If a corporation has no subsidiaries outside the U.S., its book and taxable;income are identical.;a.;True;b. False;1544. TF #2;Only U.S. corporations are included in a combined GAAP financial statement.;a.;True;b. False;1545. TF #3;Domestic and foreign entities owned more than 80% are included in a;consolidated group?s U.S. tax return.;a.;True;b. False;1546. TF #4;Giant uses the ?equity method? to account for the operations of its 40% owned;subsidiary Little. A portion of Little?s profits for the year are included in;Giant?s GAAP book income.;a.;True;b. False;1547. TF #5;The operations of an 80% or more owned domestic subsidiaries must be included;in the parent corporation?s consolidated tax return.;a.;True;b. False;1548. TF #6;Yahr, Inc., is a domestic corporation with no subsidiaries. It operates in;almost every U.S. state. Yahr records no permanent or temporary book-tax;differences this year. Yahr?s tax expense on its GAAP financial statements and;its tax liability reported on its Federal income tax return are identical.;a.;True;b. False;1549. TF #7;?Temporary differences? are book-tax income differences that eventually appear;in both the financial statements and the income tax return, but not in the same;reporting period.;a.;True;b. False;1550. TF #8;Schedule M-3 of the tax return Form 1120 reconciles financial statement net income;after tax with a large corporation?s taxable income.;a.;True;b. False;1551. TF #9;?Permanent differences? include items that appear in the Federal income tax;return as income or deduction, and in the GAAP financial statements as revenue;or expense, but in different reporting periods.;a.;True;b. False;1552. TF #10;In general, the purpose of ASC 740 (SFAS 109) is to compute and disclose the;actual taxes paid by a business entity to state, local, Federal, and foreign;governments for the current year.;a.;True;b. False;1553. TF #11;The current tax expense reported on the GAAP financial statement generally;represents the taxes actually payable to domestic or foreign governmental;authorities.;a.;True;b. False;1554. TF #12;A deferred tax liability represents a potential future tax benefit associated;with income reported in the current year GAAP financial statements.;a.;True;b. False;1555. TF #13;A deferred tax liability represents a current tax liability associated with income;or expense to be reported in future year GAAP financial statements.;a.;True;b. False;1556. TF #14;A deferred tax asset is the expected future tax benefit (savings) associated;with income reported in the current year GAAP financial statements.;a.;True;b. False;1557. TF #15;A deferred tax asset is the current tax benefit (savings) associated with;income or expense to be reported in future year GAAP financial statements.;a.;True;b. False;1558. TF #16;The valuation allowance can reduce either a deferred tax asset or a deferred;tax liability.;a.;True;b. False;1559. TF #17;If a valuation allowance is increased in the current year, the corporation?s;effective tax rate is higher than if the valuation allowance had not increased.;a.;True;b. False;1560. TF #18;If a valuation allowance is decreased (released) in the current year, the;corporation?s effective tax rate is higher than if the valuation allowance had;not increased.;a.;True;b. False;1561. TF #19;Under GAAP, a corporation can defer a disclosure of the future U.S. tax expense;related to the earnings of foreign subsidiaries, by taking into account its;repatriation plans for these earnings.;a.;True;b. False;1562. TF #20;One can describe the benefits of ASC 740-30 (APB 23) as ?all or nothing.? If it;is elected, APB 23 applies to the earnings from all foreign subsidiaries, in;the current year and thereafter.;a.;True;b. False;1563. TF #21;Repatriating prior year earnings from a foreign subsidiary located in a low-tax;country where ASC 740-30 (APB 23) benefits were previously adopted will cause;an increase in a corporation?s current year effective tax rate.;a.;True;b. False;1564. TF #22;The taxpayer should use the technique of ASC 740-30 (APB 23) income deferral;only when the tax rates that apply to the subsidiary are less than those of the;applicable U.S. income tax rate.;a.;True;b. False;1565. TF #23;The income tax note to the GAAP financial statements includes a reconciliation;of a corporation?s hypothetical tax on book income to its book tax expense as;if it were taxed at the applicable U.S. income tax rates.;a.;True;b. False;1566. TF #24;In the ?rate reconciliation? of GAAP tax footnotes, temporary book-tax;differences are reconciled between book income as if taxed at U.S. tax rates;and the actual book income tax expense.;a.;True;b. False;1567. TF #25;A $50,000 cash tax savings that is temporary has the same effect on a;corporation?s current year effective tax rate as a $50,000 cash tax savings;that is a permanent difference.;a.;True;b. False;1568. TF #26;ASC 740 (FIN 48) allows companies to choose their own level of certainty in;reporting uncertain tax positions in their financial statements.;a.;True;b. False;1569. TF #27;ASC 740 (FIN 48) replaced FAS 5, Accounting for Contingencies, with regard to;accounting for uncertain tax positions.;a.;True;b. False;1570. TF #28;The major purpose of ASC 740 (SFAS 109) is to build a cushion into currently;reported income tax expense in order to insure that the financial statements;are conservative.;a.;True;b. False;1571. TF #29;Current tax expense always totals the amount a taxpayer actually paid all;Federal, state, and foreign tax authorities in a particular year.;a.;True;b. False


Paper#59281 | Written in 18-Jul-2015

Price : $22