In 2022, OCC Corporation made a charitable donation of $400,000 to the International Rescue Committee (a qualifying charity). Forthe year, OCC reported taxable income of $1,500,000 before deducting any charitable contributions, before deducting its $20,000dividends-received deduction, and before deducting its $40,000 NOL carryover from last year.Required:a. What amount of the $400,000 donation is OCC allowed to deduct for tax purposes in 2022, what is the carryover to 2023, andwhen does the carryover expire?b. Assume that in 2023, OCC did not make any charitable donations and that it is allowed to deduct its full charitable contributioncarryover, if any, from 2022. What book-tax difference associated with the charitable contributions will OCC report in 2023? Is thedifference favorable or unfavorable? Is it permanent or temporary?Answer is complete but not entirely correct.Complete this question by entering your answers in the tabs below.Required ARequired BWhat amount of the $400,000 donation is OCC allowed to deduct for tax purposes in 2022, what is the carryover to 2023, andwhen does the carryover expire?Deductible donation$ 146,000 (Carryover$254,000Carryover expires after2028< Prev4 of 7Next >

In 2022, OCC Corporation, a qualifying charity, made a significant charitable donation of $400,000…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Al Wihabi LLC earned gross income of RO53000 in the tax year 2019. In the year company has contributed RO2000 or RO3200 or RO2650 as donation on the occasion of National day. Requirement: Determine the deductible or non-deductible donation amount.
The Kare Counseling Center was incorporated as a not-for-profit organization 10 years ago. Its adjusted trial balance as of June 30, 2023, follows. Cash Pledges Receivable-Without Donor Restrictions Estimated Uncollectible Pledges Inventory Investments Furniture and Equipment Accumulated Depreciation Furniture and Equipment Accounts Payable Net Assets Without Donor Restrictions Net Assets With Donor Restrictions-Programs Net Assets With Donor Restrictions-Permanent Endowment Contributions-Without Donor Restrictions Contributions-With Donor Restrictions Programs Investment Income-Without Donor Restrictions Net Assets Released from Restrictions-With Donor Restrictions Net Assets Released from Restrictions-Without Donor Restrictions Salaries and Fringe Benefit Expense Occupancy and Utility Expense Supplies Expense Printing and Publishing Expense Telephone and Postage Expense Unrealized Gain on Investments Depreciation Expense Totals Required a. Prepare a statement of financial position as…
The Foundation had the following preclosing trial balance at December 31, 2020, the end of its fiscal year: Trial Balance-December 31, 2020 Accounts payable Accounts receivable (net) Accrued interest receivable Accumulated depreciation Cash Contributed services Contributions-no restrictions Contributions-purpose restrictions Contributions-endowment Current pledges receivable Education program expenses Fund-raising expenses Investment revenue-purpose restrictions Training seminars expenses Land, buildings, and equipment Long-term investments Management and general expenses Net assets without donor restrictions Net assets with donor restrictions Net gains on endowments no restrictions Noncurrent pledges receivable Program service revenue - no restrictions Post-employment benefits payable (long-term) Reclassification-Satisfaction Reclassification-Satisfaction Reclassification-Satisfaction Reclassification-Satisfaction Research program expenses Short-term investments Supplies inventory…
Remsco has taxable income of $73,000 and a charitable contribution limit modified taxable income of $78,500. Its charitable contributions for the year were $8,020. What is Remsco's current-year charitable contribution deduction and contribution carryover (assuming Remsco does not elect to use the 25% of modified taxable income to determine its charitable contribution deduction)? Please pay attention to the note n bold
On July 1, 2019, the Morgan County School District received a $40,000 gift from a local civic organization with the stipulation that, on June 30 of each year, $2,500 plus any interest earnings on the unsoent principal be awarded as a collegescholorship to the high school graduate with the highest academic average. A private-purpose trust fund, the Civic Scholorship Fund, was created. Required: a. Record the followin gtransactions on the books of the Civic Scholorship Fund =: 1. On July 1, 2019, the gift was received and immediatly invested. 2. On June 30, 2020, $2,500 of the principal was converted to cash. In addition, $1,000 of interest was received. 3. On June 30 , the $3,500 was awarded to a student who had maintained a 4.0 gpa throughout her four years. 4. The nominal accounts were closed. B. Prepare a Statement of Changes in Fiduciary Net Position for the Civic Scholorship Fund for the year ended June 30, 2020.
3.) Required: On January 1, 2024, a foundation made a pledge to pay $20,000 per year at the end of each of the next five years to the Cancer Research Center, a nonprofit voluntary health and welfare organization, as a salary supplement for a well-known researcher. On December 31, 2024, the first payment of $20,000 was received and paid to the researcher. On the books of the Cancer Research Center, record the pledge in January, assuming the appropriate discount rate is 5 percent on an annual basis. The appropriate present value annuity factor is 4.3295. Record the increase in the present value as of December 31. Record the receipt of the first $20,000 on December 31 and the payment to the researcher. Note: If no entry is required for a transaction or event, select "No Journal Entry Required" in the first account field. Round intermediate calculations and final answers to the nearest whole dollar.
A private not-for-profit entity receives numerous pledges of financial support to be conveyed at various times over the next few years. Under what condition should these pledges be recognized as receivables and contributed support? At what amount should these pledges be reported?
The XYZ Trust has two income beneficiaries. The trust can distribute any amount of accounting income to the beneficiaries and corpus. Taxable interest income 40,000 Tax-exempt income interest income 20,000 Long-term capital gains-allocable to corpus 80,000 Legal and accounting fees-allocable to corpus 9,000 Money distributed to Beneficiary A 13,000 Money distributed to Beneficiary B 26,000 Determine the following: Trust Accounting Income________________________ Taxable Income________________________________ Distributable Net Income (DNI)____________________
7. Determine the amount of the donation deduction for each of the following situations: (Assume all organizations are qualified public charities) A. Personal furniture given to a local church. FMV $500 basis $2,000 B. A coin collection given to the YMCA. FMV $3,000 basis $1,000 C. Stock held or 5 years given to a local charity. FMV $5,000 basis $2,000 D. Stock held for 5 months given to a local charity. FMV $5,000, basis 2,000 E. An oil painting with a FMV $100,000 basis $40,000. The painting is given to museum and the museum plans to display the painting. F. Same as (E) above except the painting is given to the Heart Association to be sold at the annual fundraising event.
! Required information Problem 18-45 (Static) (LO 18-1, 18-2, 18-4, 18-5, 18-8) [The following information applies to the questions displayed below.] For a number of years, a private not-for-profit entity has been preparing financial statements that do not necessarily conform to U.S. generally accepted accounting principles. At the end of the most recent year (Year 2), those financial statements show total assets of $900,000, total liabilities of $100,000, net assets without donor restriction of $400,000, and net assets with donor restrictions of $400,000. This last category is composed of $300,000 in net assets with purpose restrictions and $100,000 in net assets that must be permanently held. At the end of Year 1, financial statements show total assets of $700,000, total liabilities of $60,000, net assets without donor restriction of $340,000, and net assets with donor restrictions of $300,000. This last category is composed of $220,000 in net assets with purpose restrictions and…
At the end of 2015, Learning Tree, a not-for-profit organization, received a $5 million contribution (fair value), consisting entirely of investment securities. The contribution is required to be used to establish a permanent endowment, the income from which must be used exclusively to provide free “chapter books” to elementary school children. The endowment specifies that both realized and unrealized gains may be used for this purpose in addition to investment income. Learning Tree applies FASB accounting standards for not-for-profit organizations. At the start of 2016, Learning Tree had $600,000 in unrestricted net assets. During 2016, the endowment earns $100,000 in dividends and interest. Learning Tree spends the entire amount on books and distribution costs. At year-end, the value of the endowment portfolio is $5.5 million. During 2017, the endowment earns $100,000 in dividends and interest. The entire amount is spent on books. At year-end, the fair value of the endowment…
Remsco has taxable income of $67,000 and a charitable contribution limit modified taxable income of $75,500. Its charitable contributions for the year were $7,780. What is Remsco's current-year charitable contribution deduction and contribution carryover? Multiple Choice $6,700 current-year deduction; $1,080 carryover. $7,780 current-year deduction; $0 carryover. $850 current-year deduction; $6,930 carryover. $7,550 current-year deduction; $230 carryover.

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