All corporate deductions are deductions from AGI.
|B)||False; corporations do not report AGI.|
A current year temporary book-tax difference is unfavorable if it causes taxable income to decrease relative to book income.
Federal income tax expense reported on a corporation's books generates an unfavorable temporary book-tax difference.
Similar to individuals, corporations are not subject to any limitations relating to the carryforward of unused net capital losses.
All-Star Corporation has a net operating loss in 2013. It can carry the loss back to the previous two years, starting with 2011.
For corporations, the top marginal tax rate for the alternative minimum tax is lower than the top marginal tax rate for regular income tax purposes.
All taxable corporations are required to file a Schedule M-3 with their tax returns.
Boise Corporation has gross receipts according to the following schedule:
If Boise began business as a cash-method corporation in Year 1, in which year would it have first been required to use the accrual method?
|E)||None of these|
Which of the following does not create a permanent book-tax difference?
|A)||Federal income tax expense|
|B)||Municipal bond interest income|
|C)||Charitable contributions in excess of the 10% of taxable income limitation|
|D)||Fines and penalties|
Puma, Inc. sold equipment at a loss. Puma depreciated the property using the straight-line method for financial accounting purposes and it used MACRS for tax cost-recovery. If accumulated depreciation for financial accounting purposes is less than accumulated depreciation for tax reporting purposes on the date of the sale, what is the nature of the book-tax difference associated with the loss on the sale?
Corporation P receives a dividend from Corporation Q. Corporation P includes the dividend in its gross income for tax and financial accounting purposes. If P accounted for the dividend as gross income for book and tax purposes, what can we conclude about P's ownership in Q?
|A)||P likely owns less than 20 percent of the stock of Q|
|B)||P likely owns at least 20 but not more than 50 percent of the stock of Q|
|C)||P owns more than 50 percent of the stock of Q|
|D)||Cannot be determined|
Ski Inc. owns 30 percent of Snow Inc., both of which are corporations. Snow pays Ski a dividend of $20,000 in 2013. What is the amount of Ski's dividend's received deduction, assuming the taxable income limitation does not apply?
|E)||None of these|
June Inc. issued 12,000 nonqualified stock options valued at $24,000 (in total--$2 each). Each option entitles the holder to purchase one share of stock. The options vest over three years - a third in 2013 (the year of issue), a third in 2014, and a third in 2015. Two thousand options are exercised in 2014 with a bargain element on each option of $5. What is the 2014 book-tax difference associated with the stock options (assume ASC 718 applies to the options)?
Chairs-R-Us, Inc. reported a net capital loss of $25,000 in year 4. It reported net capital gains of $10,000 in year 3 (before any capital loss carryback) and $20,000 of net capital gains in year 5 (before any capital loss carryovers). What is the amount and nature of the book-tax difference in year 5 related to the net capital loss carryover?
|D)||None of these|
LNS Corporation generated a minimum tax credit of $80,000 in 2013. If its 2013 tentative minimum tax is $300,000 and its regular tax liability is $270,000, what is its minimum tax credit carryover to 2014?
Wildcat Corp. uses the annualized income method to determine its quarterly federal income tax payments. It had $50,000, $25,000, and $45,000 of taxable income for the first, second, and third quarters, respectively ($120,000 in total through the first three quarters). What is Wildcat's annual estimated taxable income as of the end of the third quarter?