Question: Using data provided, does Elaine have any support for her concern ? Information for the prior five years is shown below: Year 2011 2012 2013

Using data provided, does Elaine have any support for her concern ?

Information for the prior five years is shown below: Year 2011 2012 2013 2014 2014 JOS Revenue $750,000 $875,000 $1,200,000 $1,700,000 $2,000,000 Cost of Goods Sold 240,000 262,500 324,000 442,000 400,000 Operating Expenses 375,000 410,500 506,250 690,500 625,000 Net Income before Taxes $135,000 $202,000 $369,750 $567,500 $975,000 Income Tax (34% tax rate) $45,900 $68,680 $125,715 $192,950 $331,500 QUESTIONS AND REQUIREMENTS 1. 2. What caused Elaine to question her client's tax return? Using data provided, does Elaine have any support for her concerns?

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