Which of the following is not a test for the deductibility of a business expense? a. Ordinary and necessary test b. Sales generation test c. Reasonableness test d. Business purpose test

In 2022, Values R Us, a real estate appraising firm, incurs the following meals expenses: $1,200 restaurant meals with business clients $1,600 for an end of year celebratory company dinner for all...

On May 1, 2022, Ella leases her condo to Fitz for a 12-month lease period starting May 1 for $1,000 per month. Ella requires that Fitz pay first months rent, last months rent and a $1,000 security...

Which of the following is true about the rental of real estate? a. Depreciation and maintenance expenses for an apartment complex are deductible. b. The expenses deductions for a home rented for 100...

Which of the following is classified as active income? a. Self-employment income from a small business b. Interest income c. Limited partnership income d. Bonus paid by an employer to an employee e....

Jim has a net operating loss in 2022. If he does not make any special elections, what is the first year to which Jim carries the net operating loss? a. 2017 b. 2018 c. 2019 d. 2021 e. 2023

During 2022, Jerry is a self-employed therapist, and his net earned income is $160,000 from his practice. Jerrys SEP Plan, a defined contribution plan, states that he will contribute the maximum...

What is the deadline for making a contribution to a traditional IRA or a Roth IRA for 2022? a. April 18, 2023 b. July 15, 2022 c. December 31, 2022 d. October 15, 2023

Mary paid $2,000 of state income taxes in 2022. She paid $1,500 of state sales tax on the purchase of goods and she also purchased a car in 2022 and paid sales tax of $3,000. How should Mary treat...

In the current year, Hoffa Partnership allocates ordinary business income of $4,000 to Jimmy, a 40-percent partner. In addition, the partnership makes a cash distribution to Jimmy of $1,000, which is...

FICA taxes are generally paid as follows: a. One-half is withheld from the employee and the other half is paid by the employer. b. The entire amount of Social Security is paid by the employee and the...

James purchased office equipment for his business. The equipment has a depreciable basis of $16,000 and was put in service on June 1, 2022. James decides to elect straight-line depreciation under...

The rate for the Social Security portion of FICA taxes for a non-self-employed individual is: a. 12.4 percent for the employer. b. 15.3 percent for the employee. c. 7.65 percent total for the...

Proudfoot, Inc. would like to deduct expenditures for tangible personal property under $4,000 as maintenance and repairs costs. To implement this policy, which of the following is not required? a. A...

Amys prior year adjusted gross income was $70,000. In order to avoid penalty, what is the required annual payment Amy must make in the current year? a. 110% of the current year tax liability. b. Any...

For most taxpayers in 2022, which of the following temporary COVID-related tax provisions remains in place? a. The employee retention credit b. The sick pay credit c. The family leave credit d. All...

Xinyi worked for two different employers in 2022 and her total wages were $80,000 for one and $87,000 for the other (total $167,000). Which of the following best describes Xinyis 2022 FICA taxes? a....

Which of the following intangibles is defined as a Section 197 intangible asset? a. An interest in land b. A partnership interest c. An interest in a corporation d. A covenant not to compete acquired...

Prashant has business property that is stolen and totally destroyed by the time it was recovered. He receives an insurance reimbursement of $5,000 on property that had a $14,000 basis and a market...

During 2022, Paul, an individual taxpayer, sells residential rental property for $180,000, which he acquired in 2001 for $160,000. Paul has claimed straight-line depreciation on the building of...

The amortization period for Section 197 intangibles is: a. 5 years b. 7 years c. 10 years d. 15 years e. 40 years

Tupper Corp. purchases a new auto in 2022 for $62,000. The auto is used 100 percent for business and the half-year convention applies. Tupper uses bonus depreciation when available. What is the 2023...

In 2022, Ben purchases and places in service a new auto for his business. The auto costs $57,000 and will be used 100 percent for business. Assuming the half-year convention applies and Ben does not...

In 2022, Ben purchases and places in service a new auto for his business. The auto costs $57,000 and will be used 60 percent for business. Assuming the half-year convention applies and Ben elects out...

Which of the following is a true statement about depreciation on listed property? a. All listed property is not depreciable, and any costs are recovered when the property is sold. b. Cellphones and...

On July 20, 2022, Kelli purchases office equipment at a cost of $24,000. Kelli elects out of bonus depreciation but makes the election to expense for 2022. She is selfemployed as an attorney, and in...

Under the special COVID tax provisions in 2020, Basalt Corporation elected to defer a portion of their payroll taxes. Which of the following best describes when Basalt must pay the deferred payroll...

Virginia and Richard are married taxpayers with adjusted gross income of $43,000 in 2022. If Virginia is able to make a $1,500 contribution to her IRA and Richard makes a $1,500 contribution to his...

Rhianna is a tax resident of the U.S. and has a bank account in in Switzerland with a balance equivalent to about US$14,000. Which of the following best describes Rhiannas foreign bank account...

If a taxpayer did not receive a copy of their Form W-2: a. They should request a copy from the Social Security Administration. b. They should file a tax return and not include the income. c. They...

Individual taxpayers may pay withholding taxes due with their individual income tax returns using Schedule H for each of the following workers except: a. A nanny hired to watch their children b. A...

Which of the following employees would not be exempt from Social Security and Medicare taxes on wages paid for household work? a. The taxpayers 16-year-old daughter b. The taxpayers wife c. The...

Bob employs a maid to clean his house. He pays her $1,040 during the current year. What is the proper tax treatment of the Social Security and Medicare tax for the maid? a. Bob is not required to pay...

Alternative minimum tax rates in individuals: a. Are the same as regular tax rates but on adjusted minimum taxable income b. Higher than the highest marginal tax rate for individuals depending on...

Rachel and Ross file jointly in 2022 and have alternative minimum taxable income of $1.3 million prior to the AMT exemption. Compute their exemption and AMTI after the exemption.

In addition to the liability existing in an estimable amount, an accrual-based taxpayer cannot deduct an expense without this also occurring. a. The expense is paid b. An invoice has been received...

A cash-basis taxpayer will recognize gross income when: a. Earned b. Actually or constructively received c. When reasonably estimable d. When shipped for goods and when provided for services

Which of the following entities is likely to have the greatest flexibility in choosing a year-end other than a calendar year-end? a. Sole proprietor b. General partnership c. Corporation d. S...

Income and loss from which of the following entities is passed through and taxed on the individuals personal tax returns? a. S corporation b. Partnership c. Sole proprietor d. All of the above

Which of the following is deductible as a miscellaneous itemized deduction in 2022? a. Tax preparation fees b. Gambling losses in excess of gambling winnings c. Losses from Ponzi-type schemes d....

Which of the following is not a possible limitation on the deduction of a personal casualty loss? a. The lesser of the fair market value of the property or the adjusted basis at the time of the loss...

During the 2022 tax year, Irma incurred the following expenses: If Irmas adjusted gross income is $23,000, calculate her miscellaneous deductions. Union dues Tax return preparation fee Brokerage fees...

Which of the following is not a source of information from which the IRS identifies possible audit targets? a. A computer scoring system that identifies possible errors on tax returns b. The client...

When the IRS has completed their examination and the result is an assessment of additional tax, which of the following is not a viable option for the taxpayer? a. Disagree with the assessment and...

In 2022, Yui, a single mother, redeems Series EE bonds and uses the total proceeds ($6,700 par value and $1,300 interest) to pay for her daughters college education. If Yuis 2022 AGI is $75,000, how...

State income tax withholding is reported on: a. Form W-2S b. Form W-4 c. Each state has a unique reporting form d. Form W-2 on Box 17

Annual wages subject to income tax are reported: a. On Form W-4 b. On Form W-2 in Box 1 c. On Form W-2 in Boxes 1, 3, and 5 d. On Form 1099-W in Box 1

Name the quality and quantity of each of the following propositions, and state whether their subject and predicate terms are distributed or undistributed: Some presidential candidates will be sadly...

Write out each of the following syllogistic forms, using S and P as the subject and predicate terms of the conclusion, and M as the middle term. (Refer to the chart of the four syllogistic figures,...

Write out each of the following syllogistic forms, using S and P as the subject and predicate terms of the conclusion, and M as the middle term. (Refer to the chart of the four syllogistic figures,...

It is strongly recommended that you have your house inspected for termite damage at the earliest possible opportunity. Determine which of the following passages are arguments. For those that are,...

If George Washington was beheaded, then George Washington died. George Washington died. Therefore, George Washington was beheaded. The following arguments are deductive. Determine whether each is...

The Empire State Building is taller than the Statue of Liberty, and the Statue of Liberty is taller than the Eiffel Tower. Therefore, the Empire State Building is taller than the Eiffel Tower The...

Every map of the United States shows that Alabama is situated on the Pacific coast. Therefore, Alabama must be a western state. The following arguments are inductive. Determine whether each is strong...

Unlike monkeys, todays humans have feet that are not suited for grasping objects. Therefore, a thousand years from now, probably humans will still have feet that are not suited for grasping objects....

It is false that some forms of human creativity are activities amenable to mathematical analysis. Therefore, it is false that all forms of human creativity are activities amenable to mathematical...

Reconstruct the following syllogistic forms and use the five rules for syllogisms to determine if they are valid from the Boolean standpoint, conditionally valid from the Aristotelian standpoint, or...

All members of the National Rifle Association are people opposed to gun control. All members of the National Rifle Association are law-abiding citizens. Therefore, all law-abiding citizens are people...

Arizona has a national park but Nebraska does not. Translate the following statements into symbolic form using uppercase letters to represent affirmative English statements. Example: Suppose you are...

Katie Couric and Brooke Baldwin report international news if and only if Erica Hill and Norah ODonnell cover political developments. Translate the following statements into symbolic form using...

If heroin is legalized, then its use may increase but criminal activity will decline. (L, U, C) Translate the following statements into symbolic form using uppercase letters to represent affirmative...

Determine whether the following symbolized arguments are valid or invalid by constructing a truth table for each.

The following symbolized arguments are missing a premise. Write the premise needed to derive the conclusion (last line ), and supply the justification for the conclusion. Try to construct the...

Use the eighteen rules of inference to derive the conclusions of the following symbolized arguments. 1. (EA) (FDA) 2. Ev G 3. Fv G I A

You are in-house general counsel of Coulomb Co., a manufacturer of electrical equipment. In the ordinary course of business you are copied on emails regarding a purchase contract for several million...

During an encounter judged as stressful, cortisol is released by the ________. a. Sympathetic nervous system b. Hypothalamus c. Pituitary gland d. Adrenal glands

Explain why the following situation is not an example of discrimination: A teacher seats students wearing short sleeves on the left half of the room and students wearing long sleeves on the right...

The following language was in a handwritten agreement signed by Harold and Saul and their respective wives: Saul & Zelda get the option to rent the lower level of the Hope Chest store when their...

Discuss what is meant by common mistake, mutual mistake, and unilateral mistake in the law of contract and explain the effect mistake will have on a contract.

John, Lesa, and Trevor form a limited liability company. John contributes 60 percent of the capital, and Lesa and Trevor each contribute 20 percent. Nothing is decided about how profits will be...

Go to www.cengagebrain.com, enter the ISBN 9781285428932, and click on Find to locate this textbooks Web site. Then, click on Access Now under Study Tools, and select Chapter 4 at the top. There, you...

Electronically-filed tax returns: a. May not be transmitted from a taxpayers home computer b. Constitute over 90 percent of the returns filed with the IRS c. Have error rates similar to paper returns...

List the documents the IRS recommends a tax preparer retain when electronically filing a taxpayers return.

In 2022, Lakota and Dominique file married filing jointly and have a 13-year-old daughter. They also provide 25 percent of the support for Lakotas 82-year-old mother, who lives in a nursing home...

Karl is a single taxpayer and has listed his brother, Jonas, as a dependent (qualifying relative). Head of household filing status seems preferable for Karl. What questions should you ask Karl to...

Which of the following statements related to standard and itemized deductions is correct? a. A taxpayer may only deduct the lower of itemized deductions or the standard deduction. b. A taxpayer may...

Which of the following entities is not likely to be a tax-paying entity? a. A single taxpayer over the age of 65 b. A single taxpayer under the age of 65 c. A corporation d. A partnership

Typically a partnership reports its taxable income or loss on: a. Form 1040 b. Form 1120 c. Form 1040X d. Form 1065

Lupita dies in 2022 but has a $1 million life insurance policy that lists her spouse, MBaku as the beneficiary. MBaku elects to receive all $1 million in a lump sum and spends $200,000 immediately on...

The distinction between qualified dividends and ordinary dividends is: a. There is no distinction. b. Ordinary dividends are taxed at preferential rates. c. Qualified dividends are taxed at...

Kate acquires a principal residence in 2017 for $200,000 secured by a $180,000 mortgage. In 2022, Kate misses work for three months. Her employer stops paying her after ten days. In 2022 when the...

Mike, a single taxpayer, has $10,000 of student loans forgiven in 2022 under a federal student loan forgiveness program. His total student loan balance was $34,000. His 2022 AGI is $55,000. How much...

In the current year, Mary started a profitable housekeeping business as a sole proprietor. She has ten housekeepers working for her and spends her time selling their services and coordinating her...

Which of the following is not considered commuting miles? a. The miles from a taxpayers home to their regular place of work b. The miles to a taxpayers home from a regular second job c. The miles...

Kendra and Lloyd get married on July 1, 2022 and will file jointly in 2022. Both of them owned a home prior to marriage, but they agree that they wish to no live together in one of the homes. Kendras...

Bonita earns $31,000 from her job, and she has $1,000 of interest income. She has itemized deductions of $35,000. There are no casualty or theft losses in the itemized deductions. What is Bonitas net...

Which of the following is not subject to self-employment tax? a. Gain on the sale of real estate held for investment b. Net earnings of a self-employed lawyer c. Distributive share of earnings of a...

Barry is a single, 40-year-old software engineer earning $140,000 a year and is not covered by a pension plan at work. How much can he put into a Roth IRA in 2022?

Bob is a single, 40-year-old doctor earning $190,000 a year and is not covered by a pension plan at work. What is the maximum deductible contribution into a Traditional IRA in 2022?

Dori is 58 years old and retired in 2022. She receives a pension of $25,000 a year and no other income. She wishes to put the maximum allowed into an IRA. How much can she contribute to her IRA?

Linda installed a special pool for the hydrotherapeutic treatment of severe arthritis, as prescribed by her doctor. The cost of installing the pool was $20,000, and her insurance company paid $5,000...

Which of the following generate self-employment income for partners/members? a. Partnership income allocated to a limited partner b. Long-term capital gains allocated to an LLC member c. Income...

A loss from the sale or exchange of property will be disallowed in which of the following situations? a. A transaction between a partnership and a partner who owns 40 percent of the partnership...

Kendra is an attorney and owns 60 percent of a law partnership. Kendra sells land to the partnership for $50,000 in the current tax year. She bought the land for $100,000 eight years ago when real...

Joe, Ben, and Melissa are partners in Collins Partnership. All three use a calendar year-end for their individual taxes. Collins Partnerships year-end is likely to be: a. October 31 since that is...

Which of the following circumstances will not cause a partnership to close its tax year early? a. The partnership terminates by agreement of the partners. b. The business activity of the partnership...

Laura is a non-passive general partner in the Douglass Partnership. At the start of 2022, her outside basis in Douglass is $10,000. During 2022, Douglass allocates loss of $8,000 to Laura and makes a...

TYVM Partnership allocates ordinary business income, long-term capital gains, and guaranteed payments of $13,000, $1,000, and $7,000, respectively, to Ariana Extensa, a general partner. Based on this...

Explain the difference in the treatment of liabilities between a general partner and a limited partner.

Carlotta is an employee and generates wages of $150,000 in 2022. Which of the following best describes the rate of tax associated with the Medicare portion of FICA taxes? a. 7.65 percent payable by...