Income Tax Fundamentals 2020
38th Edition
ISBN: 9780357391129
Author: WHITTENBURG
Publisher: Cengage
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Textbook Question
Chapter 6, Problem 5MCQ
Which of the following entities is required to report on the accrual basis?
- An accounting firm operating as a Personal Service Corporation.
- A manufacturing business with $30 million of gross receipts operating as a regular C corporation.
- A corporation engaged in tropical fruit farming in Southern California.
- A
partnership with gross receipts of $13 million and all of the partners are individuals with a December year-end.
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Income summary shows a credit balance of 1,800,000 at the end of the first year of operations.1. By what amount will the capital balance of MAR182 be credited on January 1, 2018?2. By what amount will the capital balance of MAR186 be credited on January 1, 2018?3. How much is the total assets of the partnership at the date of formation?4. What is the net effect of the adjustments made on January 1 to MAR186 capital balance?5. What is the weighted average capital of MAR182 in 2018?6. How much is the bonus given to MAR186?7. How much is the share of MAR182 in the partnership net income?8. How much is the share of MAR186 in the partnership net income?9. What is the ending adjusted capital balance of MAR182?10. What is the ending adjusted capital balance of MAR186?
Required information
[The following information applies to the questions
displayed below.]
Ries, Bax, and Thomas invested $80,000, $112,000, and
$128,000, respectively, in a partnership. During its first
calendar year, the firm earned $249,000.
Required:
Prepare the entry to close the firm's Income Summary
account as of its December 31 year-end and to allocate the
$249,000 net income under each of the following separate
assumptions.
2. The partners agreed to share income and loss in the ratio of
their beginning capital investments.
Complete this question by entering your answers
Appropriation General
of profits
Journal
Allocate $249,000 net income in the ratio of their begin
(Do not round intermediate calculations.)
Supporting Percentage of Total
Computations
Equity
Ries
Bax
Thomas
X
X
X
Income
Summary
Allocated Income
to Capital
< Appropriation of profits
General Journa
Which of the following taxpayers can use the cash method of accounting?
a. Partnerships which have a C corporation as a partner
b. Tax shelters
c. C corporations with annual average gross receipts of $27 million for the three prior tax years
d. C corporations with annual average gross receipts of $24 million for the three prior tax years
Chapter 6 Solutions
Income Tax Fundamentals 2020
Ch. 6 - E Corporation is a subchapter S corporation owned...Ch. 6 - Income and loss from which of the following...Ch. 6 - Which of the following entities is likely to have...Ch. 6 - Which of the following is an acceptable method of...Ch. 6 - Which of the following entities is required to...Ch. 6 - Prob. 6MCQCh. 6 - B Corporation, a calendar year-end, accrual basis...Ch. 6 - Prob. 8MCQCh. 6 - Prob. 9MCQCh. 6 - Prob. 10MCQ
Ch. 6 - Prob. 11MCQCh. 6 - Prob. 12MCQCh. 6 - For 2019, Roberta is a self-employed truck driver...Ch. 6 - Prob. 14MCQCh. 6 - Prob. 15MCQCh. 6 - Which of the following employees would not be...Ch. 6 - Prob. 17MCQCh. 6 - Prob. 18MCQCh. 6 - Prob. 19MCQCh. 6 - Christine and Doug are married. In 2019, Christine...Ch. 6 - Prob. 1PCh. 6 - Prob. 2PCh. 6 - Geraldine is an accrual basis taxpayer who has the...Ch. 6 - Prob. 4PCh. 6 - Prob. 5PCh. 6 - Prob. 7PCh. 6 - Prob. 8PCh. 6 - Refer to the previous problem 8. If Stan's parents...Ch. 6 - Prob. 10PCh. 6 - Prob. 11PCh. 6 - Otto and Monica are married taxpayers who file a...Ch. 6 - Prob. 13PCh. 6 - Prob. 14PCh. 6 - Prob. 15PCh. 6 - Prob. 16PCh. 6 - Sally hires a maid to work in her home for $280...Ch. 6 - Prob. 18PCh. 6 - Rachel is single and has wages of $150,000 and...Ch. 6 - Married taxpayers Otto and Ruth are both...
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