13) A taxpayer may use a cash basis for one business and an accrual basis for...
13) A taxpayer may use a cash basis for one business and an accrual basis for another business. True or False
14) For a cash method taxpayer, expenses paid with borrowed funds are deductible in the year in which the loan is repaid. True or False
15) In general, a CPA on the cash basis method will never have a bad debt deduction. True or False
16) A cash-basis taxpayer may deduct prepaid business expenses currently regardless of the period of time to which the expenses relate. True or False
Homework Answers
13) A taxpayer may use a cash basis for one business and an accrual basis for another business-FALSE
14) For a cash method taxpayer, expenses paid with borrowed funds are deductible in the year in which the loan is repaid. FALSE
15) In general, a CPA on the cash basis method will never have a bad debt deduction. True
16) A cash-basis taxpayer may deduct prepaid business expenses currently regardless of the period of time to which the expenses relate. True
Add Answer to:
13) A taxpayer may use a cash basis for one business and an
accrual basis for...
14) For a cash method taxpayer, expenses paid with borrowed funds are deductible in the year...
14) For a cash method taxpayer, expenses paid with borrowed funds are deductible in the year in which the loan is repaid. True or False 15) In general, a CPA on the cash basis method will never have a bad debt deduction. True or False 16) A cash-basis taxpayer may deduct prepaid business expenses currently regardless of the period of time to which the expenses relate. True or False 17) A cash-basis taxpayer must always include checks in income in...
1) Fred and Phyllis Black are a married couple with no children. On June 15, 2019,...
1) Fred and Phyllis Black are a married couple with no children. On June 15, 2019, Fred died. Phyllis has not remarried. For 2019, what is Phyllis' most favorable filing status? 2) Fred and Phyllis Black are a married couple with no children. On June 15, 2019, Fred died. In 2020, Phyllis has not remarried and has a dependent son who continues to live with her. For 2019, what is Phyllis' most favorable filing status for 2020? 3) Fred and...
On Dec. 15, 2018, Julia’s Service Station, an accrual-method taxpayer, prepaid $3,000 worth of deductible interest...
On Dec. 15, 2018, Julia’s Service Station, an accrual-method taxpayer, prepaid $3,000 worth of deductible interest on a business loan. The interest won’t accrue until 2019. Julia’s Service Station will be displaying for the first time at a trade show in July 2019. On Dec. 16, 2018, Julia’s prepaid the $6,000 trade show booth rental expense. The payment isn’t due until May 2019, and use of the booth will occur in July 2019. In addition, On Dec. 28, 2018, Ed’s...
B Corporation, an accrual basis taxpayer, is owned 75 percent by Bonnie, a cash basis taxpayer....
B Corporation, an accrual basis taxpayer, is owned 75 percent by Bonnie, a cash basis taxpayer. On December 31, 20x1, the corporation accrues interest of $4,000 on a loan from Bonnie and also accrues a $15,000 bonus to Bonnie. The bonus is paid to Bonnie on March 1, 2002, the interest is not paid until 20X3. How much can B Corporation deduct on its 20x2 tax return? a. $12,000 b. $19,000 c. $0 d. $4,000 e. $15,000
On Dec. 15, 2019, Julia’s Service Station, an accrual method taxpayer, prepaid $4,000 worth of deductible...
On Dec. 15, 2019, Julia’s Service Station, an accrual method taxpayer, prepaid $4,000 worth of deductible interest on a business loan. The interest won’t accrue until 2020. Julia’s Service Station will be displayed for the first time at a trade show in July 2020. On Dec. 16, 2019, Julia’s prepaid the $8,000 trade show booth rental expense. The payment isn’t due until May 2020, and the use of the booth will occur in July 2020. In addition, On Dec. 28,...
1. TF.07.042 Currently, a net operating loss can be carried forward only (no carryback exists). True...
1. TF.07.042 Currently, a net operating loss can be carried forward only (no carryback exists). True False 2. TF.08.006 The maximum cost recovery method for all personal property under MACRS is 150% declining balance True False 3. DRILL business and nonbusiness bad debts Tax Drill - Business and Nonbusiness Bad Debts Complete the following statements regarding business and nonbusiness bad debts. bad debt is a debt unrelated to the taxpayer's trade or business either when it was created or when...
On Dec. 15, 2018, Julie’s Tax Prep, a cash-method taxpayer, prepaid $3,000 worth of deductible interest on a business lo...
On Dec. 15, 2018, Julie’s Tax Prep, a cash-method taxpayer, prepaid $3,000 worth of deductible interest on a business loan. The interest won’t accrue until January 2019. Julie’s Tax Prep will be displaying for the first time at a trade show in July 2019. On Dec. 16, 2018, Julie’s prepaid the $6,000 trade show booth rental expense. The payment isn’t due until May 2019, and use of the booth will occur in July 2019. In addition, On Dec. 28, 2018,...
A taxpayer not required to use the accrual method of accounting can use the cash method...
A taxpayer not required to use the accrual method of accounting can use the cash method to account for its purchases and sales of goods and the accrual method to report all other items. True False
Questiul 3 On Dec. 15, 2019, Julia's Service Station, an accrual-method taxpayer, prepaid $4,000 worth of...
Questiul 3 On Dec. 15, 2019, Julia's Service Station, an accrual-method taxpayer, prepaid $4,000 worth of deductible interest on a business loan. The interest won't accrue until 2020. Julia's Service Station will be displaying for the first time at a trade show in July 2020. On Dec. 16, 2019, Julia's prepaid the $8,000 trade show booth rental expense. The payment isn't due until May 2020, and use of the booth will occur in July 2020. In addition, On Dec. 28,...
On Dec. 15, 2019, Julie’s Tax Prep, a cash-method taxpayer, prepaid $4,000 worth of deductible interest...
On Dec. 15, 2019, Julie’s Tax Prep, a cash-method taxpayer,
prepaid $4,000 worth of deductible interest on a business loan. The
interest won’t accrue until January 2020.
Julie’s Tax Prep will be displaying for the first time at a
trade show in July 2020. On Dec. 16, 2019, Julie’s prepaid the
$8,000 trade show booth rental expense. The payment isn’t due until
May 2020, and use of the booth will occur in July 2020.
In addition, On Dec. 28, 2019,...
B Corporation, an accrual basis taxpayer, is owned 75 percent by Bonnie, a cash basis taxpayer. On December 31, 20x1, the corporation accrues interest of $4,000 on a loan from Bonnie and also accrues a $15,000 bonus to Bonnie. The bonus is paid to Bonnie on March 1, 2002, the interest is not paid until 20X3. How much can B Corporation deduct on its 20x2 tax return? a. $12,000 b. $19,000 c. $0 d. $4,000 e. $15,000
1. TF.07.042 Currently, a net operating loss can be carried forward only (no carryback exists). True False 2. TF.08.006 The maximum cost recovery method for all personal property under MACRS is 150% declining balance True False 3. DRILL business and nonbusiness bad debts Tax Drill - Business and Nonbusiness Bad Debts Complete the following statements regarding business and nonbusiness bad debts. bad debt is a debt unrelated to the taxpayer's trade or business either when it was created or when...
Questiul 3 On Dec. 15, 2019, Julia's Service Station, an accrual-method taxpayer, prepaid $4,000 worth of deductible interest on a business loan. The interest won't accrue until 2020. Julia's Service Station will be displaying for the first time at a trade show in July 2020. On Dec. 16, 2019, Julia's prepaid the $8,000 trade show booth rental expense. The payment isn't due until May 2020, and use of the booth will occur in July 2020. In addition, On Dec. 28,...
On Dec. 15, 2019, Julie’s Tax Prep, a cash-method taxpayer,
prepaid $4,000 worth of deductible interest on a business loan. The
interest won’t accrue until January 2020.
Julie’s Tax Prep will be displaying for the first time at a
trade show in July 2020. On Dec. 16, 2019, Julie’s prepaid the
$8,000 trade show booth rental expense. The payment isn’t due until
May 2020, and use of the booth will occur in July 2020.
In addition, On Dec. 28, 2019,...
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