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Permanent and Temporary Accounts

Discuss the differences between temporary and permanent accounts. What will happen if the temporary accounts like revenue, expense and dividend accounts are not closed in the ledger? Should the permanent accounts like all asset, Stockholders' equity and liability accounts be closed as well?

Calculate: Tax Reduction Amount for a Donation

Allison is the sole shareholder of Destiny Corporation, which operates a travel agency for business travelers. Allison would like the corporation to donate some used computers to a local private school dedicated to the education of young ladies. The private school is a tax-exempt organization that qualifies donors for the charit

Depositing to a Saving Account

You want to have $25,000 saved 6 years from now to buy a house. How much less do you have to deposit today to reach this goal if you can earn 5.5 percent rather than 5 percent on your savings? Today's deposit is the only deposit you will make to this savings account.

MACRS Deprication, MACRS Computation, Income Tax Returns

Dorothy purchased a car in the current year to be used three-fourths of the time in her business and one-fourth of the time for personal purposes. The car cost $8,000 and is 5-year recovery property. No Sec. 179 expense deduction is taken. The car's basis for MACRS depreciation is A. $1,600 B. $2,000 C. $6,000 D. $8,000

Calculate the coupon rate in the given case.

Page Enterprises has bonds on the market making annual payments, with eight years to maturity, and selling for $988. At this price, the bonds yield 7.90 percent. What must the coupon rate be on the bonds? (Round your answer to 2 decimal places. (e.g., 32.16))

Moving expenses, tax deductions, adjusted gross income

Marc Clay was unemployed for all of year 1. In January of year 2, Clay obtained full-time employment 60 miles away from the city where he had resided during the 10 years preceding year 2. Clay kept his new job for all of year 2. In January of year 2, Clay paid directly moving expenses of $3,000 in relocating to his new city of r

IRA contributions, early withdrawal penalty

Mr. Knox wants to make contributions to an IRA (spousal IRA) for his wife. For Mr. Knox to be eligible to make such contributions, which of the following requirements must be met? I. They must file a joint return for the tax year. II. He must have compensation that must be included in his income for the tax year. III. Sh

Taxation Questions: Capatilization

Which of the following expenditures incurred in the operation of a business is not required to be capitalized? I. Cost of replacing an old shingle roof with a new tile roof II. Cost of changing from one heating system to another III. Cost of replacing small tools A. I only B. II only C. III only D. I and II only

Gross Income, Benefits, Insurance Policy Payments

Mr. T has been a night watchman at Y Company for 10 years. During the current year, he received the following payments from Y Company: Salary: $15,000 Hospitalization insurance premiums: $3,600 Required lodging on Y's premises for Y's convenience as a condition to T's employment: $2,400 Reward for preventing a break-in

Bond Investments for Gary and Gladys

Gary and Gladys invest in bonds. In the current year, they received the following interest: California general revenue bonds: $800 New York City sanitation fund bonds: $1,000 Seattle School District bonds: $400 AT&T 20-year bonds: $600 The state and local bonds are neither private activity bonds nor arbitrage bonds

Gross income, constructive receipt of income, claimed income

1. Which of the following does not have to be included in gross income? I. Lottery winnings II. Damages from personal injury suit involving back injuries III. Prize from church raffle A. I only B. II only C. III only D. I and II only E. I, II, and III 2. Which of the following is not considered actual receipt or "

Corporate Financial Scandal

Research a company that has been involved in a corporate financial scandal 1. Identify the company and the ethical dilemma. 2. Analyze the key elements in the situation: a. Who benefited or was harmed? How did they benefit? How were they harmed? b. What rights or claims were violated? c. What specific in

Business Structure Formation and Status

1. Review the IRS website (www.irs.gov), and then provide a link to some information related to partnership formation or termination. Provide a brief summary of the link's contents? 2. Describe the requirements and process to elect S corporation status?

Consolidations: Sale of depreciable assets to parent by sub

How do you record depreciable assets sold to a parent by a subsidiary? How does the interest in the consolidated income statement reflect this sale? Is it more, less or the same proportional shares of the reported net income of the subsidiary?

Manufacturing Costs, Income Statements, Variable Costs

1. Classifying Manufacturing Costs Your Boat, Inc. assembles custom sailboats from components supplied by various manufacturers. The company is very small and its assembly shop and retail sales store are housed in a Gig Harbor, Washington, boathouse. Below are listed some of the costs that are incurred at the company. Fo

Air Production Company

Air Production Company produces pneumatic lifts used to assist emergency rescue teams used to assist victims of auto and other accidents. The costs of manufacturing and marketing the pneumatic lifts at the company's normal volume of 3000 per month are shown in Exhibit 1. Exhibit 1 Unit manufacturing costs: Variable materi

Expenditure Cycles

For the expenditure cycle at Hewlett-Packard or any other company, what's your suggestion for the following recommendations to have good internal control of the purchase order processing?

Earned income credit

Individuals without children are eligible for the earned income credit if they meet which of the following conditions? I.. File married filing separately. II. At tax year end are at least age 25 but not more than age 64. III. For the tax year are not a dependent of another taxpayer. A. I only B. II only C. III only

AMT Amounts

Jake and Christina are married and file a joint return for the current year with taxable income of $100,000 and tax preferences and adjustments of $20,000 for AMT purposes. Their regular tax liability is $15,750. What is the amount of their total tax liability? A. $2,997 B. $11,843 C. $15,750 D. $28,503

Doulas County Replacement Costs

Doulas County's Photocopying Equipment Replacement Old Equipment Proposed Replacement Equipment Useful life in years 5 3 Current age in years 2 0 Useful life remaining, in year 3 3 Original cost $25,000 $15,000 Accumulated amortization $10,000 0 Book Value $15,000 Not acquired yet Disposal value(in ca

Amortization of a car and house

The scenario is designed to help you determine and evaluate the payment amount of a car loan and a mortgage, based on the assumption that your household income is $36,000 per year or $3,000 per month. Based on your income, you may spend 28% of your monthly income on housing, and 10% on a car loan. You are to put a 3% down pa

How accounting practices are used in businesses?

How do the following relate to the practice of accounting and its use in businesses? 1. Preparation of closing entries, reversing entries and the post-closing trial balance 2. Preparation of a classified income statement, retained earnings statement and balance sheet.

Successful Retail on a Global Level

Search the library and Internet, and provide an example of a successful retail business that competes on the global economic market. How has this led to its competitive advantage? Provide specific examples to support the points in your post.

Bad debts: ABC Company

ABC Company estimated its bad debts equal to 2.5% of its $850,000 credit sales for the year 2011. On December 31, 2011 ABC Company made an adjustment for the 2.5% amount. On July 1, 2012 the management decided that $2,000 account of Mary Smith was uncollectible and wrote it off using Allowance for Doubtful Accounts. On December