Questions from General Taxation

Q: In January, Marco incurs $2,800 in expenses traveling

In January, Marco incurs $2,800 in expenses traveling to San Diego to investigate the feasibility of acquiring a new business. He acquires the business and on March 1 forms a new corporation, Marco En...

Q: Mark flew from Baltimore to Phoenix on business. He spent four

Mark flew from Baltimore to Phoenix on business. He spent four days on business and visited friends for two days before returning home. He stayed at a hotel for the four business days but he stayed at...

Q: Tim accepts a temporary assignment that is 500 miles away from his

Tim accepts a temporary assignment that is 500 miles away from his office. The assignment is expected to last 7 months. Tim spends $7,000 for lodging and transportation and $3,000 for meals during the...

Q: Maria earns $50,000 from consulting contracts during the year

Maria earns $50,000 from consulting contracts during the year. She collects only $48,000 from her clients and expects the $2,000 will remain uncollectible. a. If Maria’s business uses accrual basis,...

Q: Jim, the owner of a tabloid magazine, is sued by

Jim, the owner of a tabloid magazine, is sued by an actor for libel and pays $15,000 in legal fees. Jim is found guilty. Jim also received many parking tickets while attending various business meeting...

Q: Maureen operates a cosmetics sales business from her home. She uses

Maureen operates a cosmetics sales business from her home. She uses 400 of 1,600 square feet of the home as an office for the entire year. Her income before her home office deduction is $3,400 and una...

Q: Teresa is an accomplished actress. During the summer, she rented

Teresa is an accomplished actress. During the summer, she rented a vacant store to stage productions of four plays, using the local townspeople as actors and stagehands. She sold $24,000 of tickets to...

Q: Neil owns a ski lodge in Aspen. His use of this

Neil owns a ski lodge in Aspen. His use of this lodge varies from year to year. The annual expenses for the lodge are as follows: Mortgage interest………………………………………$24,000 Property taxes…………………………………………...

Q: Over what ranges of taxable income in 2017 will the total income

Over what ranges of taxable income in 2017 will the total income tax liability for two persons with equal incomes who file as single individuals equal their income tax liability if they file jointly a...

Q: Maxwell Corporation has income per books before tax of $400,

Maxwell Corporation has income per books before tax of $400,000. Included in the income per books is $8,000 interest income from tax-exempt municipal bonds. In computing income per books, Maxwell dedu...