Questions from Federal Taxation

Q: Return to the facts of problem 33. Compare the total income

Return to the facts of problem 33. Compare the total income tax liability of Herman’s incorporating his business versus operating it as a sole proprietorship. Assume that he is paid a $60,000 salary...

Q: Polly owns CopyEdit, a sole proprietorship. The net income from

Polly owns CopyEdit, a sole proprietorship. The net income from CopyEdit is consistently around $200,000. Polly is considering making Kevin, one of her employees, an owner of the business. He would...

Q: Return to the facts of problem 37. Upon giving your tax

Return to the facts of problem 37. Upon giving your tax calculation results to Polly, you learn that CopyEdit's primary business is the provision of copyediting services to corporate clients. Polly...

Q: Kelly, Gwen, and Tuoi incorporated their accounting business and own

Kelly, Gwen, and Tuoi incorporated their accounting business and own all its outstanding stock. During the current year, the corporation's taxable income is $300,000 after deducting salaries of $60,0...

Q: Drew is the sole owner of Morris, Inc., a corporation

Drew is the sole owner of Morris, Inc., a corporation. Morris’s net income for the current year is $150,000 before considering Drew’s $85,000 salary. Assume Drew is single and has income from other...

Q: Return to the facts of problem 40. Assume that late in

Return to the facts of problem 40. Assume that late in the year, Drew needs extra cash to pay off gambling debts and has the corporation declare a $25,000 dividend to provide the cash. What is the e...

Q: In January of the current year, Josh purchases all the stock

In January of the current year, Josh purchases all the stock of Ballpark Corporation for $100,000. Ballpark's taxable income for the current year is $200,000, and it pays $61,250 in income tax. None...

Q: Antonio and Michaela are equal partners in A&M Booking Services

Antonio and Michaela are equal partners in A&M Booking Services. Antonio manages the business and receives $40,000 per year for his management services. He and Michaela each withdraw $30,000 in cash...

Q: What effect does the assumption of a seller's debt have on the

What effect does the assumption of a seller's debt have on the amount realized from the disposition of a property?

Q: Estel and Raymond own the GoalLine Partnership. Estel owns 70%

Estel and Raymond own the GoalLine Partnership. Estel owns 70% of the business. She provided the capital for it and consults with Raymond on overall business strategy. Raymond is responsible for th...