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- deductible)? 73. Nicole organized a new corporation. The corporation began business on April 1 of year 1. She made the following expenditures associated with getting the corporation started: Expense Attorney fees for articles of incorporation February 10 March 1-March 30 wages March 30 March 1-March 30 rent March 30 Stock issuance costs April 1 April 1-May 30 wages May 30 Date Amount $32,000 4,500 2,000 20,000 12,000 a) What is the total amount of the start-up costs and organizational expenditures for Nicole's corporation? b) What amount of the start-up costs and organizational expenditures may the corporation immediately expense in year 1 (excluding the portion of the expenditures that are amortized over 180 months)? c) What amount can the corporation deduct as amortization expense for the organizational expenditures and for the start-up costs for year 1 [not including the amount determined in part (b)]? d) What would be the total allowable organizational expenditures if Nicole…Tremonti, Inc., is obligated to pay its creditors $7,900 during the year. a. What is the value of the shareholders’ equity if assets equal $9,100? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) b. What is the value of the shareholders’ equity if assets equal $6,900? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)Check my work Kaiwan, Inc., a calendar year S corporation, is partly owned by Sharrod, whose beginning stock basis is $32,000. During the year, Sharrod’s share of a Kaiwan long-term capital gain (LTCG) is $5,000, and his share of an ordinary loss is $18,000. Sharrod then receives a $20,000 cash distribution. Compute the following. What is Sharrod’s new basis in the Kaiwan stock? Beginning Basis 32000 Add Long -term cap gain 5000 Less Distribution -20000 Deductible loss -17000 Basis in stock 0 Stock basis is 0
- The entity reports the following transactions for the 2022 tax year. The trustee accumulates all accounting income for the year. Operating income from a business $855,000 Dividend income, all from U.S. corporations(20% tax rate) 51,300 Interest income, City of San Antonio bonds 6,840,000 Trustee fees, deductible portion (25,650) Net rental losses, passive activity (171,000) Compute the Federal income tax liability for the Valerio Trust by providing the following amounts: The amount of the trustee's gross income taxed at 20% for the Valerio Trust is $fill in the blank 1.The Trustee taxable income taxed at ordinary rates for the Valerio Trust is $fill in the blank 2.The Federal income tax liability for the Valerio Trust is $fill in the blank 3.Amy and Brian were investigating the acquisition of a tax accounting business, Bottom Line Inc. (BLI). As part of their discussions with the sole shareholder of the corporation, Ernesto Young, they examined the company's tax accounting balance sheet. The relevant information is summarized as follows: FMV Adjusted Basis Appreciation Cash $ 14,500 $ 14,500 Receivables 18,800 18,800 Building 102,500 51,250 51,250 Land 260,250 86,750 173,500 Total $ 396,050 $ 171,300 $ 224,750 Payables $ 19,100 $ 19,100 Mortgage* 159,000 159,000 Total $ 178,100 $ 178,100 * The mortgage is attached to the building and land. Ernesto was asking for $445,700 for the company. His tax basis in the BLI stock was…a) Calculate the S corporation's ordinary (non-separately stated) income and indicate which items must be separately stated b) If at the beginning of the year, Archer had a basis of 20,000 compute Archer’s basis at the end of the year. c) Assume that Voyager reported a loss of $70,000 instead (and no separately stated items or distributions). If Janeway had a basis of 10,000 in her stock at the beginning of the year, what is the amount of loss she can report on her return?
- 1. Which of the following nominal rates does not apply to a C corporation? a. 10% b. 15% c. 25% d. 35% 2. Which of the following is never included in gross income? a. Loss on stock sale b. Social security benefits c. Gifts d.Unemployment benefits 3. What is George’s gross income if he has the following: Salary = $78,000; Dividends = $4,000; interest on city of San Francisco bonds = $2,000; a gain of $14,000 on a stock sale and a $4,000 loss on a small sole proprietorship that he owns. a. $78,000 b. $84,000 c. $92,000 d. $96,000 4. Azure Corporation (a C corporation) sold $100,000 of merchandise for which it paid $40,000. It also paid $35,000 of other expenses. All transactions were in cash. What is Azure’s Corporation’s after-tax net cash inflow? a. $21,250 b. $25,000 c. $60,000 d. $100,000 5. Koral Corporation can invest in a project that costs $400,000. The projectisexpectedtohaveanafter-taxreturnof$250,000ineachof years 1 and 2. Koral normally uses a 10 percent discount rate to…Amy and Brian were investigating the acquisition of a tax accounting business, Bottom Line Incorporated (BLI). As part of their discussions with the sole shareholder of the corporation, Ernesto Young, they examined the company’s tax accounting balance sheet. The relevant information is summarized as follows: Note: Leave no answer blank. Enter zero if applicable. Negative amounts should be indicated by a minus sign. FMV Adjusted Tax Basis Appreciation Cash $ 10,000 $ 10,000 Receivables 15,000 15,000 Building 100,000 50,000 50,000 Land 225,000 75,000 150,000 Total $ 350,000 $ 150,000 $ 200,000 Payables $ 18,000 $ 18,000 Mortgage* 112,000 112,000 Total $ 130,000 $ 130,000 * The mortgage is attached to the building and land. Ernesto was asking for $400,000 for the company. His tax basis in the BLI stock was $100,000. Included in the sales price was an unrecognized customer list valued at $100,000. The unallocated portion of the purchase price…On January 2, Chaz transfers cash of $165,800 to a newly formed corporation for 100% of the stock. In its initial year, the corporation has net income of $41,450. The income is credited to the earnings and profits account of the corporation. The corporation distributes $12,435 to Chaz. If an amount is zero, enter "0". a. How do Chaz and the corporation treat the $12,435 distribution? Chaz has a of $ and the corporation has a deduction of $ b. Assume, instead, that Chaz transfers to the corporation cash of $82,900 for stock and cash of $82,900 for a note of the same amount. The note is payable in equal annual installments of $8,290 and bears interest at the rate of 6%. No distributions are made during the year to Chaz. However, at the end of the year, the corporation pays an amount to meet the loan obligation (i.e., the annual $8,290 principal payment plus the interest due). Determine the total amount of the payment and its tax treatment to Chaz and the corporation. The corporate…
- Amy and Brian were investigating the acquisition of a tax accounting business, Bottom Line Inc. (BLI). As part of their discussions with the sole shareholder of the corporation, Ernesto Young, they examined the company's tax accounting balance sheet. The relevant information is summarized as follows: FMV Adjusted Basis Appreciation Cash $ 14,500 $ 14,500 Receivables 18,800 18,800 Building 102,500 51,250 51,250 Land 260,250 86,750 173,500 Total $ 396,050 $ 171,300 $ 224,750 Payables $ 19,100 $ 19,100 Mortgage* 159,000 159,000 Total $ 178,100 $ 178,100 * The mortgage is attached to the building and land. Ernesto was asking for $445,700 for the company. His tax basis in the BLI stock was…During the current year, the Squamata Corporation, a regular C corporation, has $30,000 in ordinary income, a longterm capital loss of $20,000, and a short-term capital gain of $10,000a. Calculate the Squamata Corporation's tax liability for the current year. b. Explain the nature and amount of any carrybacks or carryforwards that the corporation isentitled to use.You are a shareholder in a corporation. The corporation earns $5 per share before taxes. After it has paid taxes, it will distribute the rest of its earnings to you as dividend. The corporate tax rate is 30% and your personal tax rate on dividend income is 25%. What is the amount of your after-tax earnings on dividend? a. 0.875 b. 1.25 c. 1.875 d. 2.625 e. 3.50