Questions from Federal Taxation

Q: McHale is a C corporation owned by eight individuals, three of

McHale is a C corporation owned by eight individuals, three of whom own 51% of the stock and comprise the board of directors. The corporation operates a successful automobile repair parts manufacturin...

Q: Woodland Corporation reports the following financial accounting results and other depreciation information

Woodland Corporation reports the following financial accounting results and other depreciation information for the current year: Sales revenue…………………………………..…………………………………..$ 2,000,000 Plus: Interest...

Q: In the current year, Whitaker Corporation has taxable income of $

In the current year, Whitaker Corporation has taxable income of $700,000 and tax preference items of $100,000. It also has $250,000 of positive AMT adjustment items and $80,000 of negative AMT adjustm...

Q: Westwood Corporation has $100,000 of taxable income and $

Westwood Corporation has $100,000 of taxable income and $20,000 of tax preference items in the current year. Westwood’s positive and negative AMT adjustment items (other than the ACE adjustment) are $...

Q: Willis Corporation is a calendar year corporation that forms on April 1

Willis Corporation is a calendar year corporation that forms on April 1 of Year 1. Willis Corporation reports the following gross receipts: Year………………………….Gross Receipts 1…………………………….$ 3,000,000 2………...

Q: On June 1 of Year 1, Water Corporation places into service

On June 1 of Year 1, Water Corporation places into service a machine costing $10,000. The machine is seven-year property under the MACRS rules and has a 12-year class life. Water does not elect Sec. 1...

Q: Assume the same facts as in Problem C:5-38

Assume the same facts as in Problem C:5-38 except Water Corporation sells the machine for $9,000 on August 31 of Year 3. Determine the following: a. Water’s gain or loss on the machine’s sale for reg...

Q: Wabash Corporation, a calendar year taxpayer, purchases and places into

Wabash Corporation, a calendar year taxpayer, purchases and places into service $400,000 of equipment in Year 1. The equipment is seven-year MACRS property, and the half-year convention applies to it....

Q: Towne Corporation has the following amounts of ACE and preadjustment AMTI for

Towne Corporation has the following amounts of ACE and preadjustment AMTI for Years 1 through 5: Towne’s net ACE adjustments prior to Year 1 are zero. Calculate Towneâ€&#...

Q: Maple Corporation reports $500,000 of regular taxable income for

Maple Corporation reports $500,000 of regular taxable income for the current year. Maple also reports the following amounts of interest income earned during the current year (reflected in regular taxa...