The present value of the tax shield on CCA formula is based on the idea that tax shields from CCA continue in perpetuity as long as Blank______ . Multiple choice question. the firm has any assets remaining EBIT remains positive there are no assets in the CCA class there are assets remaining in the C

The present value of the tax shield on CCA formula is based on the idea that tax shields from CCA continue in perpetuity as long as Blank______ . Multiple choice question. the firm has any assets remaining EBIT remains positive there are no assets in the CCA class there are assets remaining in the C

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter1: An Introducti On To Taxation And Understa Nding The Federal Tax Law

Section: Chapter Questions

Problem 46DQ

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Which of the following statements regarding the accrual equivalent after-tax return is most likely TRUE? It is always less than the taxable return O It doesn't incorporate the effect of deferred taxes It is the return that equates the present value formula to the after-tax accumulation Oit ignores the capital gains tax effect associated with selling the assets at the end of the period
What is the treatment of a difference between the salvage value and UCC of an asset when the asset is sold? (UCC denotes undepreciated capital cost.) More than one answer may be correct. Multiple select question. The difference is not realized as gain or loss on the statement of comprehensive income immediately. The difference remains in the asset pool and continues to create tax shield for as long as pool exist. The difference is realized as gain or loss on the statement of comprehensive income immediately. The difference remains in the asset pool but does not create tax shield.
Multiple Choice Qsn .You have to choose one answer. 1.Which of the following statements is correct? a. Gains that are ordinary income will be assessable income under s .6-5 of ITAA 1997. b. Gains will be ordinary income if they are the type of gains that courts of law consider to be of an income character. c. A gain that comes in regularly/periodically is more likely to be ordinary income than a lump-sum gain. d. Whether or not a gain arises from an illegal activity does not affect whether it is ordinary income. e. All of the above. (2) Which of the following statements is correct? a. Capital gains and capital losses arising from a CGT event are always assessed to the individual partners of a partnership according to their interest. b. partner can have more than one interest in a partnership asset. c .There is a disposal of part of an interest in a partnership asset whenever a new partner is admitted to a partnership. d.All of the above
1. A company is deciding whether to exchange an old asset for a new asset. Within the context of the exchange decision, and ignoring income tax considerations, the undepreciated book value of the old asset would be considered a(an) Sunk cost Irelevant cost No No Yes No No Yes d. Yes Yes 2. Expected future costs that will differ among alternatives a. Opportunity cost. b. Relevant costs. c. Sunk cost. d. Out-of-pocket costs.
The modified internal rate of return (MRR) test is designed to address a limitation associated withthe use of the internal rate of return (IRR). What is that limitation?a) Working capital requirementb) Income taxesc) Reinvestment rated) Depreciation expense
Why is depreciation added to Net CAPEX? A To adjust CAPEX for taxable income B To isolate changes due to buying or selling of CAPEX с To reflect the economic value of the fixed assets
Select the best answer. An example of investment income that would be subject to the net investment income tax is: O A. Rental and royalty income O B. Tax-exempt interest O C. Wages O D. Self-employment income Submit Answers
Following IFRS, which statement is false? Group of answer choices The revaluation surplus account is a specific account reported as an unrealized gain in the statement of comprehensive income. If the revaluation initially increases the long-term operating asset's carrying value, the firm records the difference between the carrying value and the fair value (the unrealized gain) in the revaluation surplus account. The revaluation surplus account is a specific account reported in other comprehensive income (OCI) in the statement of comprehensive income. If a long-term operating asset's fair value decreases in subsequent accounting periods, after an earlier write-up, the firm reduces the revaluation surplus if it exists.
Depreciation expense is _blank_. O always relevant to capital investment decisions O only relevant to capital investment decisions if taxes are not considered O only relevant to capital investment decisions if taxes are considered O never relevant to capital investment decisions
How do taxpayers determine whether they should deduct their itemized deductions or utilize the standard deduction? Under what circumstances would you expect the after-tax return from an investment in a capital asset to approach that of tax-exempt assets (assuming equal before-tax rates of return)?
What is the treatment of a difference between the salvage value and UCC of an asset when the asset is sold? (UCC denotes undepreciated capital cost.) More than one answer may be correct. Multiple select question. The difference remains in the asset pool but does not create tax shield. The difference is realized as gain or loss on the statement of comprehensive income immediately. The difference is not realized as gain or loss on the statement of comprehensive income immediately. The difference remains in the asset pool and continues to create tax shield for as long as pool exist..3
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