Ace Corporation has located a building that it would like to acquire for its office complex. Ace Corporation has contacted the owner of the property about making a trade for Ace?s existing property. The owner of the property is only willing to sell for cash, as he will have little gain on the sale and has no use for the Ace property. Ace Corporation, on the other hand, has an extremely low basis in its property and is unwilling to sell it in order to purchase the new property. Discuss if there is any way Ace and the owner of the other property can accomplish their desires. Do you think Congress had this intent in mind when they created these tax provisions? Do you think this ?smells? of tax avoidance/deferral? The LIFO inventory method is presently an accepted inventory method for tax purposes. This method, during inflation, results in a lower ending inventory value than the other inventory methods. Accordingly, this method reduces present taxable income and reduces the overall tax bill. However, LIFO is not allowed under IFRS. If LIFO is not allowed for external reporting purposes and the LIFO conformity rule is not modified, then companies presently using LIFO must change their inventory method. This change can result in increased income taxes. Assume you have a newly incorporated client operating in an inflationary business environment that is contemplating adopting LIFO. What would you advise them? What factors would you consider in that recommendation?

Ace Corporation has located a building that it would like to acquire for its office complex. Ace Corporation has contacted the owner of the property about making a trade for Ace's existing property. The owner of the property is only willing to sell for cash, as he will have little gain on the sale and has no use for the Ace property. Ace Corporation, on the other hand, has an extremely low basis in its property and is unwilling to sell it in order to purchase the new property. Discuss if there is any way Ace and the owner of the other property can accomplish their desires. Do you think Congress had this intent in mind when they created these tax provisions? Do you think this \"smells\" of tax avoidance/deferral? The LIFO inventory method is presently an accepted inventory method for tax purposes. This method, during inflation, results in a lower ending inventory value than the other inventory methods. Accordingly, this method reduces present taxable income and reduces the overall tax bill. However, LIFO is not allowed under IFRS. If LIFO is not allowed for external reporting purposes and the LIFO conformity rule is not modified, then companies presently using LIFO must change their inventory method. This change can result in increased income taxes. Assume you have a newly incorporated client operating in an inflationary business environment that is contemplating adopting LIFO. What would you advise them? What factors would you consider in that recommendation? Provide specific details to support your opinions in your response