Question 1

All of the following are false regarding apportionment except?

Accepted Answer

A)  Applies to only business income. 
B)  Applies to only nonbusiness income. 
C)  Applies to both business and nonbusiness income. 
D)  Investment income is subject to apportionment. 
A)  Applies to only business income. 
B)  Applies to only nonbusiness income. 
C)  Applies to both business and nonbusiness income. 
D)  Investment income is subject to apportionment.

Question 2

Which of the following statements regarding income tax commercial domicile is incorrect?

Accepted Answer

A)  The location where a business is headquartered. 
B)  The location where a business is incorporated. 
C)  The location from which a business directs its operations. 
D)  None of the choices are correct. 
A)  The location where a business is headquartered. 
B)  The location where a business is incorporated. 
C)  The location from which a business directs its operations. 
D)  None of the choices are correct.

Question 3

Hoosier Incorporated is an Indiana corporation. It properly included, deducted, or excluded the following items on its federal tax return in the current year:   State depreciation expense was $50,000. Hoosier's federal taxable income was $150,300. Calculate Hoosier's Illinois state tax base.

Accepted Answer

A)  $171,300 
B)  $173,800 
C)  $199,633 
D)  $207,133 
A)  $171,300 
B)  $173,800 
C)  $199,633 
D)  $207,133

Question 4

Discuss the steps necessary to determine whether a sales tax applies and how the tax is collected.

Accepted Answer

Determine whether the seller has sales t

Question 5

Interest and dividends are allocated to the state of commercial domicile.

Accepted Answer

A) True 
 B)False

Question 6

Public Law 86-272 was a congressional response to Northwestern States Portland Cement.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following activities will create sales tax nexus?

Accepted Answer

A)  Advertising using television commercials. 
B)  Salespeople physically located in a state from which they only take orders. 
C)  Delivery of sales by UPS. 
D)  $90,000 of sales on 190 online sales transactions. 
A)  Advertising using television commercials. 
B)  Salespeople physically located in a state from which they only take orders. 
C)  Delivery of sales by UPS. 
D)  $90,000 of sales on 190 online sales transactions.

Question 8

Giving samples and promotional materials without charge is a protected solicitation activity.

Accepted Answer

A) True 
 B)False

Question 9

Public Law 86-272 protects a taxpayer from which of the following taxes?

Accepted Answer

A)  Texas Margin Tax (a tax with net income, gross receipts, and capital worth components). 
B)  Washington Business & Occupation Tax (a gross receipts tax). 
C)  Ohio Commercial Activity Tax (an excise tax with a gross receipts base). 
D)  California Franchise Tax (a net income tax). 
A)  Texas Margin Tax (a tax with net income, gross receipts, and capital worth components). 
B)  Washington Business & Occupation Tax (a gross receipts tax). 
C)  Ohio Commercial Activity Tax (an excise tax with a gross receipts base). 
D)  California Franchise Tax (a net income tax).

Question 10

Roxy operates a dress shop in Arlington, Virginia. Roxy also ships dresses nationwide upon request. Roxy's Virginia sales are $1,000,000 and out-of-state sales are $200,000. Assuming that Virginia's sales tax rate is 5 percent, what is Roxy's Virginia sales and use tax liability?

Accepted Answer

A)  $0. 
B)  $10,000. 
C)  $50,000. 
D)  $60,000. 
A)  $0. 
B)  $10,000. 
C)  $50,000. 
D)  $60,000.

Question 11

Several states are now moving from a strict physical presence test toward an economic presence test for income taxes.

Accepted Answer

A) True 
 B)False

Question 12

Handsome Rob provides transportation services in several western states. Rob has payroll as follows:   Rob is a California corporation and the following is true:
Rob has income tax nexus in Arizona, California, Nevada, and Washington. The Washington drivers spend 25 percent of their time driving through Oregon. California payroll includes $200,000 of payroll for services provided in Nevada by California-based drivers. What is Rob's California payroll numerator?

Accepted Answer

A)  $934,589 
B)  $1,134,589 
C)  $1,215,347 
D)  $2,657,275 
A)  $934,589 
B)  $1,134,589 
C)  $1,215,347 
D)  $2,657,275

Question 13

Most states have shifted away from an equally weighted three-factor to a heavily weighted sales apportionment formula.

Accepted Answer

A) True 
 B)False

Question 14

Use tax liability accrues in the state where purchased property will be used when the seller of the property is not required to collect sales tax.

Accepted Answer

A) True 
 B)False

Question 15

Super Sadie, Incorporated, manufactures sandals and distributes them across the southwestern United States. Assume that Super Sadie has sales tax nexus in Arizona, California, Colorado, New Mexico, and Texas. Super Sadie has sales as follows:
   Assume the following sales tax rates: Arizona (6 percent), California (8 percent), Colorado (7 percent), New Mexico (6.5 percent), Oregon (7.25 percent), Texas (8 percent), and Utah (5 percent). What is Super Sadie's total sales and use tax liability? (Round your interim calculations to the nearest whole number.)

Accepted Answer

$233,900.
($583,194 × 6 percen

Question 16

The payroll factor includes payments to independent contractors.

Accepted Answer

A) True 
 B)False

Question 17

Wyoming imposes an income tax on corporations.

Accepted Answer

A) True 
 B)False

All of the following are false regarding apportionment except?

Which of the following statements regarding income tax commercial domicile is incorrect?

Hoosier Incorporated is an Indiana corporation. It properly included, deducted, or excluded the following items on its federal tax return in the current year: State depreciation expense was $50,000. Hoosier's federal taxable income was $150,300. Calculate Hoosier's Illinois state tax base.

Discuss the steps necessary to determine whether a sales tax applies and how the tax is collected.

Interest and dividends are allocated to the state of commercial domicile.

Public Law 86-272 was a congressional response to Northwestern States Portland Cement.

Which of the following activities will create sales tax nexus?

Giving samples and promotional materials without charge is a protected solicitation activity.

Public Law 86-272 protects a taxpayer from which of the following taxes?

Roxy operates a dress shop in Arlington, Virginia. Roxy also ships dresses nationwide upon request. Roxy's Virginia sales are $1,000,000 and out-of-state sales are $200,000. Assuming that Virginia's sales tax rate is 5 percent, what is Roxy's Virginia sales and use tax liability?

Several states are now moving from a strict physical presence test toward an economic presence test for income taxes.

Most states have shifted away from an equally weighted three-factor to a heavily weighted sales apportionment formula.

Use tax liability accrues in the state where purchased property will be used when the seller of the property is not required to collect sales tax.

The payroll factor includes payments to independent contractors.

Wyoming imposes an income tax on corporations.

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Nonliquidating Distributions

Corporate Formation, Reorganization, and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

The Us Taxation of Multinational Transactions

Transfer Taxes and Wealth Planning

Filters

Exam 12: State and Local Taxes

All of the following are false regarding apportionment except?

Which of the following statements regarding income tax commercial domicile is incorrect?

Hoosier Incorporated is an Indiana corporation. It properly included, deducted, or excluded the following items on its federal tax return in the current year: State depreciation expense was $50,000. Hoosier's federal taxable income was $150,300. Calculate Hoosier's Illinois state tax base.

Discuss the steps necessary to determine whether a sales tax applies and how the tax is collected.

Interest and dividends are allocated to the state of commercial domicile.

Public Law 86-272 was a congressional response to Northwestern States Portland Cement.

Which of the following activities will create sales tax nexus?

Giving samples and promotional materials without charge is a protected solicitation activity.

Public Law 86-272 protects a taxpayer from which of the following taxes?

Roxy operates a dress shop in Arlington, Virginia. Roxy also ships dresses nationwide upon request. Roxy's Virginia sales are $1,000,000 and out-of-state sales are $200,000. Assuming that Virginia's sales tax rate is 5 percent, what is Roxy's Virginia sales and use tax liability?

Several states are now moving from a strict physical presence test toward an economic presence test for income taxes.

Most states have shifted away from an equally weighted three-factor to a heavily weighted sales apportionment formula.

Use tax liability accrues in the state where purchased property will be used when the seller of the property is not required to collect sales tax.

The payroll factor includes payments to independent contractors.

Wyoming imposes an income tax on corporations.

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Nonliquidating Distributions

Corporate Formation, Reorganization, and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

The Us Taxation of Multinational Transactions

Transfer Taxes and Wealth Planning

Filters