Give the correct citation to section 40 of the treatise The Law of Torts by Dan B. Dobbs published by West Group in 2000.

Zenon Inc. has the following taxable income: U.S. source income ..$1,900,000 Foreign source income . 240,000 Taxable income ..$2,140,000 Zenon paid $33,000 foreign income tax. Compute its U.S. income...

Ms. Barth is a professional tax return preparer. Three years ago, she prepared the Form 1120 for Denver Inc. Her fee for the preparation was $14,850. Upon audit of the re-turn, the IRS disallowed a...

In 2011, there was a change in the authoritative weight of interpretive versus legislative regulations. Briefly explain what changed and why.

Suppose that person A, while aiming a gun at person B, invites B to write a check. Explain the efficiency argument for allowing B to cancel the check later.

Do you think that criminal procedure in this country is weighted too heavily in favor of accused persons? Can you think of a fairer way to balance the constitutional rights of accused persons against...

How could SDI reduce the likelihood of similar lawsuits occurring in the future? Aegis Communications hired Southwest Desert Images, LLC, (SDI) to provide landscaping services for its property. SDI...

Marcellus Jackson, the CFO of Mac, Inc., notices that the tax liability reported on Macs tax return is less than the tax expense reported on Macs financial statements. Provide a letter to Jackson...

When Dr. Arthur M. Edwards died, leaving a will disposing of his property, he left the villa type condominium in which he lived, its contents, and $ 10,000 to his stepson, Ronald W. Souders. Edwards...

In 2009, Xio and Xandra each invest $300,000 to create Xava Corporation. Xava develops and manufactures rock climbing and bungee jumping equipment. The business has become very profitable (it now is...

Multiple Choice Question 1. Bob, a mechanic, claims that Cathy owes him $1,500 on a repair job. Bob wants to assign his claim to Hardknuckle Bank. The likeliest reason that Bob wants to do this is A....

Merlin Winters had three sons. Merlin and his youngest son, Abraham, had a falling out in 1994 and stopped speaking to each other. Merlin made a formal will in 1996, leaving all of his property to...

Anne is employed by Bradley Contracting Company. Bradley has a $1.3 million contract to build a small group of outbuildings in a national park. Anne alleges that Bradley Contracting has discriminated...

Roy and Brandi are engaged and plan to get married. During 2014, Roy is a full-time student and earns $9,000 from a part-time job. With this income, student loans, savings, and nontaxable...

A taxpayer is considering two mutually exclusive alternatives. Alternative A is to hire a tax accountant at a cost of $ 20,000 to research the tax law on a tax avoidance plan. If successful, the plan...

Business Ethics magazine reported the following ethical dilemma submitted by an anonymous reader: Mary had only a few days to earn $1,000 in sales that would allow her to reach the $1 million sales...

KAI, a calendar year corporation, reported $500,000 net income before tax on its financial statements prepared in accordance with GAAP. The corporations records reveal the following information: KAI...

Kurt, an avid skier, wanted to clear some wet snow and ice from his chair on the chairlift as it moved toward him from the boarding ramp. He was unable to sit down in time and simply grabbed onto the...

China is a signatory country to the Madrid Protocol on the international registration of trademarks. Starbucks opened its first cafe in China in 1999 and has added outlets in numerous locations...

BBB Company has been a successful manufacturer of quality electronics products for the past 20 years. It is a publicly traded company with 1 million shares outstanding. During the past three years,...

Cleveland Chiropractic College (CCC) promised prospective students that CCC would provide clinical training and experiencea critical part of a chiropractic education and a requirement for graduation...

Joseph Supersonic Company, a U.S. jet fighter manufacturer, is eager to sell its aircraft to the stateowned airline of the Republic of Platano and wishes to retain a local representative to assist...

A county court in Illinois is deciding a case involving an issue that has never been addressed before in that states courts. The Iowa Supreme Court, however, recently decided a case involving a very...

Jim is the owner and president of ZZZ Company. He and his close friend, Dan, graduated with MBAs. They always dreamed about being successful and making lots of money. They have worked in the same...

When a Meeting of the Minds Is Lacking Chatter is a social networking service that promises to keep its users data private. However, Chatter sells its data to a data broker who then sells it online....

Valence Corporation's Form 1120S shows ordinary income of $88,000 for the year. Daniel owns 40% of the Valence stock throughout the year. The following information is obtained from the corporate...

Calvin reviewed his cancelled checks and receipts this year for charitable contributions. He has owned the IBM stock and painting since 2005. Calculate Calvin's charitable contribution deduction and...

Hospital administrator Jake Rosen9 was recently convicted for fraud he committed against his employer, Cedar Hospital Systems. Over a period of six years, he allegedly made payments to a dummy...

Amanda and Jaxon Stuart have a daughter who is one year old. The Stuarts are full-time students and they are both 23 years old. Their only sources of income are gains from stock they held for three...

The Dickinson Elks Club conducted an annual Labor Day golf tournament. Charbonneau Buick-Pontiac offered to give a new car as a prize to anyone making a hole in one on hole no. 8. The golf course of...

Josh Thomas, Jack Wiley, and Will Regis are three close friends who have been offered the opportunity to invest $100,000 each and to become 10 percent shareholders each in a closely held corporation...

Tiger, Inc., a calendar year S corporation, is owned equally by four shareholders: Ann, Becky, Chris, and David. Tiger owns investment land that was purchased for $160,000 four years ago. On...

Mr. and Mrs. Soon are the sole shareholders of SW Inc. For the last three years, SW has employed their son as a sales representative and paid him a $30,000 annual salary. During a recent IRS audit,...

Determine whether the following statements relating to the AMT for a corporation are true or false. If false, explain why. a. Tax preference items only increase AMTI. b. A corporation uses the same...

1. The lower court concluded that the note was non-negotiable and dismissed the bank's attempt to enforce it. Was this an error? 2. Suppose that the note in this case had stated, "The terms of the...

1. Based on this information, do you believe Publishers Clearing House has committed fraud? 2. Why or why not? A recent newspaper contained the following story: Publishers Clearing House agreed to...

Simon Weinberg and his brother were the only partners in Times Square Stationers LLP. The partners signed a 20-year lease with Tisch Leasing. After 12 years, Simon retired from the business and was...

The Whitewater LLP is equally owned by three partners and has the following balance sheet at the end of the current tax year: Partner Petula is an active (i.e., general) partner retiring from the...

Theta Corporation reports the following results for the current year: Gross profits on sales . $220,000 Dividends from less-than-20%-owned domestic corporations .. 100,000 Operating expenses 218,000...

Tonya Jefferson, a sole proprietor, runs a successful lobbying business in Washington, D.C. She doesn't sell many business assets, but she is planning on retiring and selling her historic townhouse,...

King County, Washington, hired Frank Coluccio Construction Co. (FCCC) to act as general contractor for a public works project involving the construction of a small utility tunnel under the Duwamish...

McNeely entered into a contract with Wagner to pay $250,000 as a lump sum for all timber present in a given area that Wagner would remove for McNeely. The contract estimated that the volume in the...

Wade filed his Federal income tax return on time but did not remit the balance due. Compute Wade's failure to pay penalty in each of the following cases. The IRS has not issued a deficiency notice....

Mr. RH purchased 30 acres of undeveloped ranch land 10 years ago for $935,000. He is considering subdividing the land into one-third-acre lots and improving the land by adding streets, sidewalks, and...

Economy Forms Corp. sold concrete-forming equipment to Kandy. After using the equipment for more than six months, Kandy notified Economy that the equipment was inadequate. Economy Forms alleged that...

Congress adopted a law to provide insurance to protect wheat farmers. The agency in charge of the program adopted regulations to govern applications for this insurance. These regulations were...

Pizza of Gaithersburg and The Pizza Shops (Pizza Shops) contracted with Virginia Coffee Service (Virginia) to install vending machines in each of their restaurants. One year later, the Macke Company...

Consider the three aspects of the fraud triangle. If you were hired by the board of directors to tell them what they could do to prevent fraud, what general activities would you tell them to engage...

Your auditing firm has just landed a new client: a large software company managed by two brothers who together own 15 percent of the stock. You learn that the company fired its last auditor. You also...

Berts Sporting Goods, Inc., with stores located throughout the state of Lys, sells a wide variety of sporting goods, including guns. Section 123.45 of the Lys Penal Code requires sellers of guns to...

You started the Triangular Frisbee Company as a small operation. When the product went over big, you decided to seek outside funding to build a larger company. Your lawyer explained to you the costs...

The plaintiffs in this case were descendants of Holocaust victims who had lived in various countries in Europe. Before the Holocaust, the plaintiffs ancestors had purchased insurance policies from...

Adrian was awarded an academic scholarship to State University for the 2014- 2015 academic year. He received $6,500 in August and $7,200 in December 2014. Adrian had enough personal savings to pay...

The Greater Gulf State Fair, Inc. operated the Gulf State Fair in Mobile County, Alabama. One of the events at the fair was a mechanical bull ride, and participants paid money to ride the mechanical...

The County of Contra Costa, California, held a tax sale in which it offered for sale a vacant piece of property located in the city of El Cerrito. Richard J. Schultz, a carpenter, saw the notice of...

The Eggers Corporation filed an amended Form 1120, claiming an additional $400,000 deduction for payments to a contractor for a prior tax year. The amended return was based on the entity's...

Describe to a married couple three advantages of making the gift-splitting election.

Steem Advertising Corporation acquires 100 laptop computers in 2010 for its account executives to use. Steem pays $300,000 for the computers and bundled software. You are the newly hired CPA and you...

When evaluating new projects and investments, the ABC Corporation calculates after-tax cash flows and earnings assuming the firms marginal tax rate equals the top federal statutory tax rate of 35%....

Tammy Olsen has owned 100% of the common stock of Green Corporation (basis of $75,000) since the corporation's formation in 2005. In 2012, when Green had E & P of $320,000, the corporation...

Reggie, who is 55, had AGI of $32,000 in 2016. During the year, he paid the following medical expenses: Drugs (prescribed by physicians) .............................. $200 Marijuana (prescribed by...

Rich, a club member, left his golf clubs with Bogan, the pro at the Happy Hours Country Club, to be refinished at Bogans pro shop. The refinisher employed by Bogan suddenly left town, taking Richs...

James Duke filed a suit against Pacific Telephone & Telegraph Company (PT&T) and two of its employees for invasion of privacy through unauthorized wiretapping. Duke claimed that defendants employees...

What is the key factor in determining whether Buy-Mart is liable under this doctrine? Lynne Meyer, on her way to a business meeting and in a hurry, stopped at a Buy-Mart store for a new pair of...

Discount Plus Company has been concerned for some time about its cash flows. Since the company began five years ago, Discounts business has increased steadily, yet cash flows have remained virtually...

In 2002, Farrokh and Scheherezade Sharabianlou were looking for a location for a printing business. They signed a purchase agreement to buy a building owned by Berenstein Associates for $2 million...

Lynn is a salesperson who entertains clients at business luncheons. A business relationship exists for the entertainment, and there is a reasonable expectation of business benefit. However, no...

A famous New York City hotel, Hotel Lux, is noted for its food, as well as its luxury accommodations. Hotel Lux contracts with a famous chef, Chef Perlee, to become the hotels head chef at $6,000 per...

THE ECONOMIC DIMENSION What should Jean do next appeal the courts decision, settle with BHP for the amount of the judgment, or go through the foreclosure process? Explain. The Legal Environment...

Flicker Corporation, a calendar year taxpayer, manufactures yogurt that it wholesales to grocery stores and other food outlets. The company also operates a yogurt shop near its factory, where it...

Camden Corporation, a calendar year accrual basis corporation, reported $5 mil-lion of net income after tax on its financial statements prepared in accordance with GAAP. In addition, the following...

Alpha Corporation purchases 20% of Theta Corporation stock from Milt on August 10 of the current year. Alpha purchases an additional 30% of the stock from Nick on November 15 of the current year....

When Steven Simkin divorced Laura Blank, they agreed to split their assets equally. They owned an account with Bernard L. Madoff Investment Securities estimated to be worth $ 5.4 million. Simkin kept...

SafeCo Manufacturing Company pays $20 to purchase materials from related suppliers in Canada. SafeCo incurs $15 in labor costs at its factory in the United States to fabricate and assemble a garden...

Germanie Fequiere executed and delivered a promissory note in the principal amount of $ 240,000 to BNC Mortgage. As security for the note, Fequiere executed and delivered a mortgage on real property....

Parchment, Inc., is created with the following asset and liability contributions. Jake and Fran each receive 100 shares of Parchment common stock. *The land is subject to a mortgage of $20,000 that...

Describe the effect of a $100,000 cash distribution paid on January 1 to the sole shareholder of a calendar year corporation whose stock basis is $25,000 when the corporation has a. $100,000 of...

Plaintiff, a Swiss corporation, entered into contracts to purchase chicken from B.N.S. International Sales Corporation. Defendant was a New York corporation. The English language contracts called for...

International Paint Company wants to sell a large tract of land with several facilities on it to U.S. Parts Inc. As acquisitions manager for U.S. Parts, what do you need to know before buying this...

Emily and Freda are negotiating with George to purchase the business he operates as Pelican, Inc. The assets of Pelican, Inc., a C corporation, are as follows. *Potential depreciation recapture is...

Corporation Hs auditors prepared the following reconciliation between book and tax-able income. Hs tax rate is 34 percent. Net income before tax .$600,000 Permanent book/tax differences .. 15,000...

In what ways do e-business transactions pose heightened fraud risks?

Using the legend provided, classify each of the following tax sources. Legend P = Primary tax source S = Secondary tax source B = Both N = Neither a. Sixteenth Amendment to the U.S. Constitution. b....

Karen writes Bob a long letter in which she falsely accuses him of stealing her bike. Bob is outraged because no one has ever questioned his character in that way before. He is so incensed that he...

Return to the facts of problem 67. Assume that you are the CPA in charge of preparing the tax return for each of the taxpayers in the problem. Based on the Statements on Standards for Tax Services...

Suppose your parents founded a wildly successful business in which they still own 90% of the outstanding stock, which is the source of most of their wealth. The basis in their stock is close to zero....

1. Unconscionable Contract Jackson, a widow who was desperate for money, sold land to her brother, Seymour, for $ 275. Later Seymour found valuable timber on the land and sold some of it for $ 2,353....

1. Is Colwell an individual with a disability under the ADA? Explain. 2. How should Chapman have responded to Colwells request? Explain. 3. A part-time retail clerk who is unable to drive because he...

At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $15,000 and accumulated E&P of $20,000 from a previous year as a C...

Negligent in failing to give warning of the approach of its train to a crossing, CC Railroad thereby endangers Larry, a blind man who is about to cross. Mildred, a bystander, in a reasonable effort...

While auditing a client, the CEO asks you to look carefully at the cash flow. You notice that cash flows have decreased every year. Upon learning of your findings, the CEO remarks, I seem to bring in...

A&P Grocery Stores decided to sell its own brand of canned milk (referred to as private label milk). A&P asked its longtime supplier, Borden, to submit an offer to produce the private label milk....

Erin, an employee of Fine Print Shop, is injured on the job. For Erin to obtain workers compensation, does her injury have to have been caused by Fine Prints negligence? Does it matter whether the...

Tootie Corporation operates in two states, as indicated below. All goods are manufactured in State A. Determine the sales to be assigned to both states in computing Tootie's sales factor for the...

You are chief executive officer of a toy manufacturing firm. Your firm has been inspected by officials at OSHA, the federal Occupational Safety and Health Administration, for alleged violations of...

Lund offered to sell Steck his car and told Steck that the car had been driven only 25,000 miles and had never been in an accident. Steck hired Carvallo, a mechanic, to appraise the condition of the...

1. What is the term for the type of e-mail that Donahue received offering a sample of the nutritional supplement? 2. Assuming that the information contained in the e-mail was not false or misleading,...

Gi Hwa Park entered into a lease with Landmark HHH, LLC, for retail space in the Plaza at Landmark, a shopping center in Virginia. The lease required that the landlord keep the roof in good repair...

If you were an HR executive at Wegmans, would you focus more on internal recruiting or on external recruiting? Would your strategy for higher level positions differ from your strategy for lower-level...

Daniel Fox owned Fox and Lamberth Enterprises, Inc., a kitchen and bath remodeling business, in Dayton, Ohio. Fox leased a building from Carl and Bellulah Hussong. Craftsmen Home Improvement, Inc.,...