Regan received a letter from Chase, the material portion of which stated: Chase hereby places an order with you for fifty cases of Red Top Tomatoes, ship them C.O.D. Promptly upon receipt of the...

On May 10, the Apple Company, acting through one Brown, entered into a contract with Crane for the installation of a milking machine at Cranes farm. Following the enumeration of the articles to be...

On September 2, 2005, Levine executed a mortgage bond under which she promised to pay the Mykoffs a preexisting obligation of $54,000. On October 14, 2011, the Mykoffs transferred the mortgage to...

In July 2004, Emellie Anderson hired Kenneth Whitten, a licensed building contractor, to construct a two-story addition to her home. The bottom floor was to be a garage and the second floor a home...

Visa U.S.A., Inc., MasterCard International, Inc., American Express (Amex), and Discover are the four major credit- and charge-card networks in the United States. Visa and MasterCard are joint...

Ollies Barbecue is a family-owned restaurant in Birmingham, Alabama, specializing in barbecued meats and homemade pies, with a seating capacity of 220 customers. It is located on a state highway 11...

Harold and Maude are both 55 years of age and have two married children. Harold is an engineer and is an active participant in his companys qualified pension plan. Maude is a retired school teacher...

For a number of years, Nina was a mechanical engineer for a chemical company. She always enjoyed working around her home in her spare time, doing necessary repairs and maintenance. However, she was...

Pat was divorced from her husband in 2010. During the current year she received alimony of $18,000 and child support of $4,000 for her 11-year-old son, who lives with her. Her former husband had...

Beta Corporation received permission to change its tax year from a calendar year to a year ending August 31. Its income for the eight months ending August 31 is $96,000. What is Beta Corporation's...

TRUE/FALSE 1. One advantage of arbitration is that it provides the parties with greater opportunities for discovery than litigation does. 2. In the United States, there are many separate courts, but...

Conrad and Darby were competitors in the business of dehairing raw cashmere, the fleece of certain Asiatic goats. Dehairing is the process of separating the commercially valuable soft down from the...

Mike Trujillo has been involved in a serious relationship with his high school sweetheart, Bonny, for five years; they have even discussed marriage. One day, Bonny told Mike that she was seeing...

Mae and Vernon are equal owners of Denson, Inc., an S corporation. Denson owns 5,000 shares of stock in Cowboy Country. Denson paid $300,000 for the Cowboy Country stock, which is qualified small...

As of November 30, 2015, Ms. B had $12,000 capital losses and no capital gains. She owns 4,900 shares of GG stock with a $15 basis and a $45 FMV per share. Ms. B plans to hold her stock for three...

Lou and Stella North are married, file a joint return, and have two dependent children in college, Phil and Jaci. Both attend State University, and neither receives any type of financial assistance....

Muller, a shareholder of SCM, brought an action against SCM over his unsuccessful negotiations to purchase some of SCMs assets overseas. He then formed a shareholder committee to challenge the...

Interstate Brands makes and distributes bakery products such as Hostess, Dolly Madison, and Wonder Bread. Different distribution systems handled different products. The employer consolidated its...

Peppertree, Inc., hired Robert McClellan, a licensed contractor, to repair a condominium complex that was damaged in an earthquake. McClellan completes the work, but Peppertree fails to pay....

Your tax client Chen asks whether it is likely that her Form 1040 will be audited this year. You suspect that Chen might modify the information she reports on her return based on your answer. Address...

Falcon Corporation, a calendar year taxpayer, is a deepwater offshore drilling company that is planning to sell drilling equipment that it no longer needs. The drilling equipment has an adjusted...

Elvis Presley, a singer of great renown and a man of substantial wealth, became engaged to Ginger Alden. He was generous with the Alden family, paying for landscaping the lawn, installing a swimming...

Assume Gail is a wealthy widow whose husband died last year. Her dependent daughter lives with her for the entire year. Gail has interest income totaling $379,900 and she pays property taxes and home...

Three years ago, Mario joined the MN Partnership by contributing land with a $10,000 basis and an $18,000 FMV. On January 15 of the current year, Mario has a basis in his partnership interest of...

Jacobs, owner of a farm, entered into a contract with Earl Walker in which Walker agreed to paint the buildings on the farm. As authorized by Jacobs, Walker acquired the paint from Jones with the...

Ms. Wise was fired from her job at the Mead Corporation after she was involved in a fight with a coworker. On four other unrelated occasions, fights occurred between male coworkers. Only one of the...

Are the Hyatts bound by the contract terms specified on Cyber Tools Terms of Service page that they did not read? Which of the required elements for contract formation might the Hyatts claim lack?...

Have any of the employers in the following cases terminated an employee in violation of public policy? Has each employer acted ethically? a. A nonexempt employee alleged that she was discharged after...

Suppose that Lofts board of directors had approved Pepsi-Colas use of its personnel and equipment. Would the courts decision have been different? Discuss. In the 1920s, Loft Candy Company (Loft,...

Universal Video sells $40 million worth of video recording equipment in the United States. The total sales of such equipment in the United States is $100 million. One-half of Universals sales is to...

Valley Furniture & Interiors, Inc., bought an insurance policy from Transportation Insurance Co. (TIC).The policy provided coverage of $50,000 for each occurrence of property loss caused by employee...

Kimberly Cloutier began working at the Costco store in West Springfield, Massachusetts, in July 1997. Cloutier had multiple earrings and four tattoos, but no facial piercings. In June 1998, Costco...

If a U.S. company establishes a 100 percent subsidiary in another country, what three general aspects of U.S. income tax law should the company be sure it has addressed?

Brown was a wholesale insurance broker, a middleman between retail insurance agents and insurance companies. He worked closely with Galtney for a company in which they shared commissions in an agreed...

Dr. Gregory B. Nazar removed a malignant tumor from Roe Branhams brain on February 27, 2000. The surgery was a success, but shortly afterward Branham began to experience pain in his head. The pain...

Calculate the 2011 tax liability and the tax or refund due for each situation: a. Mark is single with no dependents and has a taxable income of $50,000. He has $9,000 withheld from his salary for the...

The McConnells bought a home in Sherwood Estates. The land was subject to a restrictive covenant that no building, fence, or other structure could be built on the land without the approval of the...

Mona viewed herself as a creative individual who had chosen to go to law school for economic reasons. Mona's undergraduate majors were creative writing and American Indian studies. Mona was very...

Fred Lyon of New York, while on vacation in California, rented a new model Home Run automobile from Harts Drive-ACar. The car was manufactured by the Dumars Motor Company and was purchased by Harts...

Technical Textile agreed by written contract to manufacture and sell 20,000 pounds of yarn to Jagger Brothers at a price of $2.15 per pound. After Technical had manufactured, delivered, and been paid...

On January 10, Betty, of Emanon, Missouri, visited the showrooms of the Forte Piano Company in St. Louis and selected a piano. A sales memorandum of the transaction signed both by Betty and by the...

Capricorn, Inc., is planning to go public by offering its common stock, which previously had been owned by only three shareholders. The company intends to limit the number of purchasers to...

In December 2001, Mervyn Losing, a manager at a Food Lion grocery store, was selected to take a random drug test. The test result came back as substituted, meaning the sample submitted did not appear...

Go to this texts Web site at www.cengage.com/blaw/clarkson and select Chapter 22. Click on Video Questions and view the video titled Matilda. Then answer the following questions. (a) What warranties...

What are some steps that businesspersons can take to avoid any issues at the border with respect to the contents of their electronic devices?

The plaintiff is a Connecticut limited liability company [ a form of business organization] * * * , which constructed a luxury home at 4 Pan Handle Lane in Westport [ Connecticut] ( the property). *...

You are a CPA in practice and have a long-term client who is involved in a nasty divorce proceeding with her husband. The client has assets she deposited in a bank account in the Grand Cayman...

Assume the same facts as in Problem 13-56 except the taxpayer is a corporation instead of an individual. a. What is the recognized gain on the sale of the building and the character of the gain? b....

A taxpayer is a 30-year-old junior high school history teacher in Maine. Her classes focus on the history of the Roman Empire. She plans on tracing the expansion of the Roman Empire by, traveling on...

1. What if Stewart was never told about the rat problem. Did he have a responsibility to find out? 2. What about the workers who shipped the contaminated meat each day? Should they be guilty of some...

1. The Tennessee Supreme Court in Wait (and most courts in workers compensation cases) required a two-part showing that the injury must arise out of and in the course of employment. a. Explain those...

On April 1, 2016, Paul sold a house to Amy. The property tax on the house, which is based on a calendar year, was due September 1, 2016. Amy paid the full amount of property tax of $2,500. Calculate...

Waronek owned and operated a trucking rig, transporting goods for L.T.L. Perishables, Inc., of St. Paul, Minnesota. He accepted an offer to haul a trailer load of beef from Illini Beef Packers, Inc.,...

Calvin Roach, a native-born American of Acadian descent, was fired by Dresser Industrial. Roach claimed that he was fired because of his Acadian national origin (Cajun descent) and his association...

Tillie Flinn properly executed a durable power of attorney designating her nephew James C. Flanders and/or Martha E. Flanders, his wife, as her attorney in fact. Seven months later, Martha Flanders...

In March and April 1998, John Doe, an employee of the U.S. Postal Service, missed several weeks of work because of an AIDS-related illness. Does supervisor told him that he had to submit an...

Peg worked with a local IRS-approved charity whose mission was to capture and neuter feral cats and take care of them until they could be released back into the wild. Peg incurred more than $ 6,000...

The statute is Cal. Corp. Code 1800. The title of the statute is, "Verified complaint; plaintiff; grounds; intervention by shareholder or creditor; exempt corporations." The statute applies in...

Read the following two cases and explain why the Supreme Court reached different conclusions for cases involving similar facts and issues: CIR v. Court Holding Co., 33 AFTR 593, 45-1 USTC 9215...

Mr. and Mrs. Revel had $206,200 AGI before considering capital gains and losses. For each of the following cases, compute their AGI: a. On May 8, they recognized a $8,900 short-term capital gain. On...

Anthony promises to pay McCarthy $10,000 if McCarthy reveals to the public that Washington is a Communist. Washington is not a Communist and never has been. McCarthy successfully persuades the media...

Suppose that Coca-Cola had been trying to make the public believe that its product contained cocaine. Would the result in this case likely have been different? Why?

Courts have to decide whether to defer to community norms when setting a standard of negligence or to set a legal standard independently from the community norm. A community of homeowners has norms...

Four surgeons conducted theirmedical practices through an LLC they created and owned. The LLC obtained a $1.5 million line of credit from Emprise Bank to fund operations. It was secured by personal...

American Academic Suppliers (AAS) and Beckley-Cardy (B-C) both sold educational supplies to schools. When B-Cs sales began to plummet, it responded by reducing its catalog prices. It also offered an...

While auditing the accounts payable of a large clothing manufacturer, you discover that four of the companys vendors have checks sent to a post office (PO) box. After further investigation, you...

During the current year, Snowden Corporation distributes $600,000 in cash ($2 per share) to its shareholders. Yong owns 300 shares of Snowden stock with a basis of $9,000. What are the tax...

James Ferguson operates "11-E Auto Sales" in Jonesborough, Tennessee as a sole proprietorship. In 1999, Consumer Finance Co. issued a policy to "Jim Ferguson, Jim 11-E Auto Sales" covering "Owned...

Burlington Coat Factory Warehouse, Inc., had a dress code that required male salesclerks to wear business attire consisting of slacks, shirt, and a necktie. Female salesclerks, by contrast, were...

A federal statute, 8 U.S.C. 1409, sets requirements for acquisition of U.S. citizenship by a child born outside the United States to unwed parents, only one of whom is a U.S. citizen. If the mother...

In each of the following independent cases, write a memo for the tax research file in preparation for a meeting with Gary. In each memo, explain whether the proposed plan meets his objective of...

Jack, a geologist, had been debating for years whether or not to venture out on his own and operate his own business. He had developed a lot of solid relationships with clients and he believed that...

The Brewers contracted to purchase Dower House from McAfee. Then, several weeks before the May 7 settlement date for the purchase of the house, the two parties began to negotiate for the sale of...

On June 21, George Washington Croom died testate. In his will Croom left various bequests of real and personal property to his children and a grandchild. In Item Eight of his will Croom stated I...

Dubois sold Hocking a condominium that included an option to participate in a rental pool arrangement. Hocking elected to participate in the arrangement. Under it, the rental pool's agent rented...

Haile owned an old roadside building that she believed could easily be converted into an antique shop. She talked to her friend Ann Marie, an antique fancier, and they executed the following written...

Nelson died in 1996 and Newman and Franz were appointed co-personal representatives of her estate. Newman and Franz hired McKenzie-Larson to appraise the estate's personal property in preparation for...

The California and Hawaiian Sugar Company (C& H), a California corporation, is an agricultural cooperative owned by 14 sugar plantations in Hawaii. It transports raw sugar to its refinery in...

Jerry Jeff Keen, the CFO of Boots Unlimited, a Texas corporation, has come to you regarding a potential restructuring of business operations. Boots has long manufactured its western boots in plants...

An applicant who had been in the military for twenty-five years, including in Special Forces units, received the unanimous recommendation of the selection committee and was offered a job with the...

McDonald has contracted to purchase 500 pairs of shoes from Vetter. Vetter manufactures the shows and tenders delivery to McDonald. Mc Donald accepts the shipment. Later, on inspection, McDonald...

Iverson owned Iverson Motor Company, an enterprise engaged in the repair as well as the sale of Oldsmobile, Rambler, and International Harvester Scout automobiles. Forty percent of the businesss...

Nova, Inc., sought to sell a new issue of common stock. It registered the issue with the Securities and Exchange Commission but included false information in both the registration statement and the...

Objective Theory of Contracts Al and Rosemary Mitchell owned a small secondhand store. The Mitchells attended Alexanders Auction, where they frequently shopped to obtain merchandise for their...

Magnum Company produces 77 percent of the coal utilized in the United States. Coal provides 25 percent of all of the energy used in the United States. In a suit brought by the United States against...

On February 1, the Gazette Corporation hired Susan Sharp to conduct an audit of its books and to prepare financial statements for the corporations annual meeting on July 1. Sharp made every...

Rawlings purchased a typewriter from Kroll Typewriter Co. for $600. At the time of the purchase, he made an initial payment of $75 and agreed to pay the balance in monthly installments. A security...

How might a fraud investigator benefit by attending the deposition of opposing experts?

1. The New York Court of Appeals found that Jacob & Youngs had substantially performed the contract. To what, if any, remedy was Kent entitled? 2. A requirement of substantial performance is good...

Why might Congress and the Treasury avoid drafting tax rules that are very specific? What costs would such rules impose on the Internal Revenue Service? What benefits might they bestow on certain...

Grand Corporation owns all of the stock of Junior, Ltd., a corporation that has been declared bankrupt and has no net assets. Junior still owes $1 million to Wholesale, Inc., one of its suppliers,...

George, age 68, decides to retire from farming and is considering selling his farm. The farm has a $100,000 basis and a $400,000 FMV. Georges two sons are not interested in farming. Both sons have...

Tango Corporation, a calendar year taxpayer, has been an S corporation for several years. Tangos business activities have become very profitable in recent years. On June 16, 2015, its sole...

True or False: 1. Sole proprietorships must file a tax return. 2. Ownership in a partnership is not transferable. 3. Creditors of a partnership must first seek recovery from partnership assets before...

A consumer entered into an agreement with Rent-It Corporation for the rental of a television set at a charge of $17 per week. The agreement also provides that if the renter chooses to rent the set...

Orlando borrows a gasoline-driven lawn edger from his neighbor, Max. Max has not used the lawn edger for two years. Orlando has never owned a lawn edger and is not familiar with its use. Max...

Assume that fully taxable bonds yield 10% per year before tax, tax exempt bonds yield 6.5%, and the pretax return on single premium deferred annuities (SPDAs) is 9.5%. a. What are the after tax rates...

Assume the same facts as in Exercise 5. But now you expect your tax rate on ordinary income to decline to 20% in year 3. How do your answers in Exercise 5 change? Would you make the Section 83(b)...

Harold installed a safe and an alarm system and bought a German shepherd dog to protect his vintage paperback and comic book collection. What are his deductible items?

You and Joe Jones, your neighbor and friend, bought lottery tickets at the corner drugstore. While watching the lottery drawing on television with you that night, Joe leaps from the couch, waves his...