Questions from Federal Taxation

Q: King Construction Company is engaged in a road construction contract to build

King Construction Company is engaged in a road construction contract to build a highway over a three-year period. King will receive $11,200,000 for building five miles of highway. King estimates that...

Q: For each of the following cases, indicate whether the taxpayer has

For each of the following cases, indicate whether the taxpayer has selected an allowable tax year in an initial year. If the year selected is not acceptable, indicate what an acceptable year would be....

Q: a. In which courts may litigation dealing with tax matters begin

a. In which courts may litigation dealing with tax matters begin? b. Discuss the factors that might be considered in deciding where to litigate. c. Describe the appeals process in tax litigation.

Q: In light of the economic performance requirement, how much is deductible

In light of the economic performance requirement, how much is deductible by the following accrual-basis corporate taxpayers this year? a. Camp Corporation sells products with a one-year warranty. Cam...

Q: Prime Corporation begins operations in late 2017. Prime decides to use

Prime Corporation begins operations in late 2017. Prime decides to use the single-pool LIFO method. Year-end inventories under FIFO are as follows: 2017……………………….$110,000 2018………………………..134,000 2019…...

Q: First Company sold the following assets during the year. Indicate whether

First Company sold the following assets during the year. Indicate whether First Company can use the installment method to report each transaction. If not, how is the transaction reported? Assume First...

Q: Joe sells land with a $60,000 adjusted basis for

Joe sells land with a $60,000 adjusted basis for $42,000. He incurs selling expenses of $2,000. The land is subject to a $10,000 mortgage. The buyer, who assumes the mortgage, pays $8,000 down and agr...

Q: On January 30, 2017, Amy sells land to Bob for

On January 30, 2017, Amy sells land to Bob for a stated price of $200,000. The full $200,000 is payable on January 30, 2019. No interest is stated. Amy, a cash-method taxpayer, purchased the land in 2...

Q: Dana manages real estate and is a cash method taxpayer. She

Dana manages real estate and is a cash method taxpayer. She changes to the accrual method in 2018. Dana’s business income for 2018 is $30,000 computed on the accrual method. Her book...

Q: BCD Partnership has, for many years, had a March 31

BCD Partnership has, for many years, had a March 31 year-end. The partnership’s net income for the fiscal year ended March 31, 2018 is $400,000. Because of its fiscal year, BCD has $100,000 on deposit...