Questions from General Taxation


Q: A corporation has taxable income is $1,500,000

A corporation has taxable income is $1,500,000. If it distributes its after-tax income to its shareholders whose dividend tax rate is 15 percent, what are the total tax and the combined effective tax...

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Q: Six years ago, Sharon purchased her principal residence for $500

Six years ago, Sharon purchased her principal residence for $500,000. In the current year, she converts the property to rental use because she has been unable to sell it due to the depressed real esta...

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Q: Paul purchased a royalty interest in an oil well for $125

Paul purchased a royalty interest in an oil well for $125,000. Paul’s share of gross income from oil sales for the year is $40,000 and his share of expenses for the oil production is $13,000. What is...

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Q: Orange Corporation acquired all of the assets of Lemon Company for $

Orange Corporation acquired all of the assets of Lemon Company for $10,000,000. The fair market value of the tangible assets totaled $8,000,000. The $2,000,000 difference is considered goodwill. Orang...

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Q: Zenon Corporation (a calendar-year corporation) began work on

Zenon Corporation (a calendar-year corporation) began work on a new experimental project in year 1. It incurred $8,000 in qualifying research expenses in year 1 and $11,000 in year 2. The benefits fro...

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Q: The Prosperity Corporation has accumulated $200,000 of earnings beyond

The Prosperity Corporation has accumulated $200,000 of earnings beyond the reasonable needs of the business. The corporation’s regular taxable income is $165,000. Its adjusted taxable income for deter...

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Q: P Corporation owns 90 percent of the stock of S1 Corporation.

P Corporation owns 90 percent of the stock of S1 Corporation. S1 Corporation owns 45 percent of S2 Corporation and 86 percent of S3 Corporation. S3 Corporation owns 40 percent of S2 Corporation and 70...

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Q: A corporation has gross sales revenue of $289,000,

A corporation has gross sales revenue of $289,000, cost of sales of $98,000, a Section 179 deduction of $20,000 (financial depreciation = $5,000), operating expenses of $122,000, and a Section 1231 ga...

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Q: The Jingle Corporation has income from operations of $459,000

The Jingle Corporation has income from operations of $459,000. It has dividend income of $68,000 from a corporation in which it owns 5 percent. a. What is the corporation’s taxable income? b. How wo...

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Q: What is a corporation’s income tax if its income is:

What is a corporation’s income tax if its income is: a. $70,000? b. $280,000? c. $900,000? d. $2,250,000? e. $14,000,000?

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