Question 1

When is a taxpayer required to annualize income for a short tax year?

Accepted Answer

The answer of When is a taxpayer required to annualize...

Question 2

_____ 22. Income of a nonresident alien cannot be taxed by the United States.

Accepted Answer

A) True 
 B)False

Question 3

Billy's father owns a controlling interest in Big Top Corporation. Billy needed $20,000 to pay a gambling debt and the corporation made a loan to Billy at no interest for the $20,000. This transaction can be characterized as:

Accepted Answer

A)  A gift loan to Billy 
B)  An employment-related loan 
C)  An arm's length loan 
D)  A disguised dividend to the father

Question 4

Put T for Taxable income or N for Nontaxable income beside each item below as it normally would be treated for tax purposes.
-_____ o. Child support received

Accepted Answer

The answer of Put T for Taxable income or N...

Question 5

Put T for Taxable income or N for Nontaxable income beside each item below as it normally would be treated for tax purposes.
-_____
a. Income earned in year 2 of a four-year long-term contract using the completed contract method.

Accepted Answer

The answer of Put T for Taxable income or N...

Question 6

Which of the following types of income would a nonresident alien avoid paying tax on in the U.S.?

Accepted Answer

A)  U.S. business income 
B)  Non-U.S. business income 
C)  Interest on U.S. savings accounts 
D)  Dividends from U.S. corporations

Question 7

_____ 5. All taxpayers may use the accrual method of determining income but certain taxpayers may not use the cash method.

Accepted Answer

A) True 
 B)False

Question 8

_____ 21. Under the source principle of international taxation, income will be taxed in a particular jurisdiction if the source of that income is a business operating in that jurisdiction.

Accepted Answer

A) True 
 B)False

Question 9

To whom do the doctrines of constructive receipt and claim of right apply?

Accepted Answer

A)  Cash basis taxpayers only 
B)  Accrual basis taxpayers only 
C)  Cash basis, accrual basis, respectively 
D)  Accrual basis, cash basis, respectively

Question 10

____ 20. The basis in inherited property is normally determined at the decedent's date of death.

Accepted Answer

A) True 
 B)False

Question 11

Clayton Corporation receives $100,000 to provide garbage service for the next four years:

Accepted Answer

A)  Clayton must recognize income over the four years for both tax and accounting purposes. 
B)  Clayton can include the entire $100,000 in income currently for both tax and accounting purposes. 
C)  The $100,000 creates a permanent difference between tax and accounting income. 
D)  The $100,000 creates a timing difference between tax and accounting income.

Question 12

Put T for Taxable income or N for Nontaxable income beside each item below as it normally would be treated for tax purposes.
-_____ k. Alimony received

Accepted Answer

The answer of Put T for Taxable income or N...

Exam 3: Determining Gross Income

When is a taxpayer required to annualize income for a short tax year?

_____ 22. Income of a nonresident alien cannot be taxed by the United States.

Billy's father owns a controlling interest in Big Top Corporation. Billy needed $20,000 to pay a gambling debt and the corporation made a loan to Billy at no interest for the $20,000. This transaction can be characterized as:

Put T for Taxable income or N for Nontaxable income beside each item below as it normally would be treated for tax purposes. -_____ o. Child support received

Put T for Taxable income or N for Nontaxable income beside each item below as it normally would be treated for tax purposes. -_____ a. Income earned in year 2 of a four-year long-term contract using the completed contract method.

Which of the following types of income would a nonresident alien avoid paying tax on in the U.S.?

_____ 5. All taxpayers may use the accrual method of determining income but certain taxpayers may not use the cash method.

_____ 21. Under the source principle of international taxation, income will be taxed in a particular jurisdiction if the source of that income is a business operating in that jurisdiction.

To whom do the doctrines of constructive receipt and claim of right apply?

____ 20. The basis in inherited property is normally determined at the decedent's date of death.

Clayton Corporation receives $100,000 to provide garbage service for the next four years:

Put T for Taxable income or N for Nontaxable income beside each item below as it normally would be treated for tax purposes. -_____ k. Alimony received