Explore BrainMass


Assumptions, Principles, and Constraints of Accounting

Please help me explain the following concepts: - The basic assumptions of accounting - The principles of accounting - The constraints of accounting - A conclusion stating how you think sound financial reporting depends on principles, assumptions, and constraints. Refer to the U.S. GAAP in your response.

IRC Section 351

How many distinct steps or requirements are contained in the language of IRC Section 351 (a) for non-recognition treatment, and what are they?

Taxation: Ownership and Income

1.Bendetta, a high-tax-rate taxpayer, owns several rental properties and would like to shift some income to her daughter, Jenine. Bendetta instructs her tenants to send their rent checks to Jenine so Jenine can report the rental income. Will this shift the income from Bendetta to Jenine? Why, or why not? 2.Latrell recently us

Accounting Information Systems Questions

What important information, related to the accounting equation, is captured by accounting information systems? How does this information get translated to the financial statements? Is it necessary for the accounting information systems to record debits and credits? Why or why not? Why do some organizations continue to use

Government and Institutional Accounting

In your role as the financial manager, you routinely review your firm's financial statements and financial ratios to evaluate the financial health of your company. How does one review and analyze financial statements in a for-profit company? How does this compare to how financial statements are analyzed for a nonprofit orga

The Question of Bonus Deferment

Under the terms of his salary agreement, president Juan Rivera has an option of receiving either an immediate bonus of $40,000, or a deferred bonus of $75,000 payable in 10 years. Ignoring tax considerations, and assuming a relevant interest rate of 8%, which form of settlement should Rivera accept? Should she... - Accept Bo

Variable Costing vs. Absorption Costing

You are the vice president of operations for a small manufacturing company that uses the absorptive method of accounting for fixed manufacturing overhead, and you are approaching the end of the year. The accounting manager just visited some of your supervisors and said that the profitability of the company can appear better if m

Home office deductions

The following individuals maintained offices in their home: (1) Dr. Austin is a self-employed surgeon who performs surgery at four hospitals. He uses his home for administrative duties as he does not have an office in any of the hospitals. (2) June, who is a self-employed plumber, earns her living in her customer's homes. S

Deduction for moving expenses

In which of the following situations is the taxpayer not allowed a deduction for moving expenses? A. Marva moves from Dallas to Washington D.C. in her job as an IRS agent. She is still working at the IRS Washington office after one year. B. Pam moves from Phoenix to Los Angeles to take a new job. She works at the Los Angeles

Deducting Entertainment Expenses

Joe is a self-employed tax attorney who frequently entertains his clients at his country club. Joe's club expenses include the following: Annual dues $ 5,400 Initiation fees

Non payment of loan

Last year, Abby loaned Pat $10,000 as a gesture of their friendship. Although Pat had signed a note payable that contained interest payments and a maturity date, the loan had not been repaid this year when Pat died insolvent. For this year, assuming that the loan was bona fide, Abby should account for nonpayment of the loan as a

Determining a Casualty

Which of the following is most likely not considered a casualty? A. death of a pine tree due to a two-day infestation of pine beetles B. fire loss C. water damage caused by a broken water heater D. water damage to the walls and ceiling of a taxpayer's personal residence as the result of gradual deterioration of the roof.

Passive activity definition

Which of the following is not generally classified as a passive activity? A. an activity in which the taxpayer does not materially participate B. a business in which the taxpayer owns an interest and works 1,000 hours a year C. a limited partnership interest D. rental real estate

Active Business Income

During the year, Mark reports $90,000 of active business income from his law practice. He also owns two passive activities. From Activity A, he earns $20,000 of income, and from Activity B, he incurs a $30,000 loss. As a result, Mark A. reports AGI of $80,000. B. reports AGI of $90,000 with a $10,000 loss carryover. C. repo

Moving deductions

Donald takes a new job and moves to a new residence. The distances are as follows: Old residence to new job 70 miles Old residence to old job 8 miles By how many miles does the move exceed the minimum distance requirement for the moving expense deduction?

Employee Business Expenses and AGI Limit

Sarah incurred employee business expenses of $5,000 consisting of $3,000 business meals and $2,000 customer entertainment. She provided an adequate accounting to her employer's accountable plan and received reimbursement for one-half of the total expenses. How much of the meals and entertainment will be deductible by Sarah witho

Calculating Travel Deductions

Norman traveled to San Francisco for four days on vacation, and while there spent another two days conducting business for his employer. Norman's plane fare for the trip was $500; meals cost $150 per day; hotels cost $300 per day; and a rental car cost $150 per day that was used for all six days. Norman was not reimbursed by his

Auto accident and 2013 AGI

Juanita, who is single, is in an automobile accident in 2012 and her car sustains $6,200 in damages. Because both drivers received tickets in the accident, Juanita does not expect to recover any of the loss from her insurance company. Juanita's 2012 AGI is $31,000, and she deducts a $3,000 loss on her 2012 tax return. Her other

Deductible Loss After Limitation

Jarrett owns a mountain chalet that he purchased in 1999 for $175,000. This year, the home appraised at $300,000. Shortly after the appraisal, a blizzard hit the area in spring of the current year, destroying trees and severely damaging several homes, including Jarrett's chalet. Its value was reduced to $135,000. Jarrett does no

Deductible Loss and Rental Property

Using 2013 Tax Code: Shaunda has AGI of $90,000 and owns rental property generating a $27,000 loss. She actively manages the property. Her deductible loss is: A. $0. B. $13,500. C. $25,000. D. $27,000.

Discussion Questions

Discussion questions for federal income tax: Types and Benefits John and Jill, who are married, reported 2012 itemized deductions of $7,500 and $500 respectively. John suggests that they file their Federal income tax returns separately-he will itemize his deductions from AGI, and she will claim the standard deduction. Expl

How Inventory Tracking Technology Relates to Accounting Information Systems

Please access the link below: and discuss how inventory tracking technology relates to Accounting Information System . Please relate to internal controls. Do you think this technology can be used effectively?

30 Accounting Study Questions

1) The statement of cash flows is used for . 2) Non-operating items on the income statement . 3) The difference between a single-step and multiple-step income statement is that a single-step income statement . 4) Which one of the following statements is true? 5) The accounting convention uses the acquisition cost minus d

Tax Considerations

Dr. Mark Skousen, in his article, "Raising Cain: Why the 9-9-9- Tax Plan is a Dangerous Policy", states that Republican Herman Cain has gotten quite a bit of publicity about his new 9-9-9 tax plan. His bill would scrap the current tax system and replace it with a flat 9% corporate income tax, a 9% tax on individual income and a

Kirsi Products' East Division

Kirsi Products is decentralized. Division bonuses are based on return on investment (ROI), and so division managers are very careful about their ROI. Operating results for the company's East Division for last year are given below when the company's overall ROI was 18%: Sales $ 25,200,000 Variable expenses 14,000,000 Contr

Equity-method reporting situations

In what types of situations could it be appropriate to use equity-method reporting even though the investor does not hold voting common stock of the investee? Explain.

Calculation of Market Value and Book Value

Klingon Cruisers, Inc., purchased new cloaking machinery three years ago for $9.5 million.  The machinery can be sold to the Romulans today for $6.5 million.  Klingon's current balance sheet shows net fixed assets of $5.2 million, current  liabilities of $2.4 million, and net working capital of $800,000.  If all the