Question & Answer

When a taxpayer receives a nonqualified distribution from a Roth IRA, is the entire amount of the distribution treated as taxable income? Explain.

1.       : Why do you think workplace stress is skyrocketing? Do you think it is a trend that will continue? Explain the reasons for your answer.

Name some of the important chemical cleaning methods.

30 Cost function using high-low method Wentworth Ltd sold 100 000 1 litre bottles of mineral water last year at $4 per unit and made a profit of $50 000. This year the costs for Wentworth Ltd remained the same, it sold 120 000 units at the same price, and made a profit of $80 000.   Required   (a)   Determine the total fixed costs per year and the total variable cost per unit for Wentworth Ltd using the high-low method. (b)   Write an equation for the cost function based on your answer to (a)

Explain why organisational form may vary if specific knowledge versus general knowledge is needed for decision making.

Describe how a piece of glass is heat treated to produce tempered glass.

Explain how a life insurance company’s asset portfolio may be affected by inflation. (LO3)

Explain how a partner’s debt relief affects their amount realized in a sale of partnership interest.

The following note appears in the “Summary of Significant Accounting Policies” section of the Annual Report of Westinghouse Electric Corporation. Note 1 (in part): Revenue Recognition. Sales are primarily recorded as products are shipped and services are rendered. The percentage-of-completion method of accounting is used for nuclear steam supply system orders with delivery schedules generally in excess of five years and for certain construction projects where this method of accounting is consistent with industry practice. WFSI revenues are generally recognized on the accrual method. When accounts become delinquent for more than two payment periods, usually 60 days, income is recognized only as payments are received. Such delinquent accounts for which no payments are received in the current month, and other accounts on which income is not being recognized because the receipt of either principal or interest is questionable, are classified as nonearning receivables. Instructions (a) Identify the revenue recognition methods used by Westinghouse Electric as discussed in its note on significant accounting policies. (b) Under what conditions are the revenue recognition methods identified in the first paragraph of Westinghouse’s note above acceptable? (c) From the information provided in the second paragraph of Westinghouse’s note, identify the type of operation being described and defend the acceptability of the revenue recognition method.

In January of year 0, Justin paid $4,800 for an insurance policy that covers his business property for accidents and casualties. Justin is a calendar-year taxpayer who uses the cash method of accounting. What amount of the insurance premium may Justin deduct in year 0 in each of the following alternative scenarios?

Explain why taxpayers are allowed to exclude gifts and inheritances from gross income even though these payments are realized and clearly provide taxpayers with the wherewithal to pay.

Explain how credit rating agencies have changed their rating processes following criticism of their ratings during the credit crisis. (LO1)

Why might a business claim a reduced §179 expense amount in the current year rather than claiming the maximum amount available?

A connecting rod is designed to be hot forged in an impression die. The projected area of the part is 6,500 mm2 . The design of the die will cause flash to form during forging, so that the area, including flash, will be 9,000 mm2 . The part geometry is considered to be complex. As heated the work material yields at 75 MPa, and has no tendency to strain harden. Determine the maximum force required to perform the operation.

With reference to Table 4.1, determine the increase in length of a steel bar whose length = 10.0 in, if the bar is heated from room temperature of 70°F to 500°F.

Pat Delaney Company leases an automobile with a fair value of $8,725 from John Simon Motors, Inc., on the following terms: 1. Noncancelable term of 50 months. 2. Rental of $200 per month (at end of each month). (The present value at 1% per month is $7,840.) 3. Estimated residual value after 50 months is $1,180. (The present value at 1% per month is $715.) Delaney Company guarantees the residual value of $1,180. 4. Estimated economic life of the automobile is 60 months. 5. Delaney Company’s incremental borrowing rate is 12% a year (1% a month). Simon’s implicit rate is unknown. Instructions (a) What is the nature of this lease to Delaney Company? (b) What is the present value of the minimum lease payments? (c) Record the lease on Delaney Company’s books at the date of inception. (d) Record the first month’s depreciation on Delaney Company’s books (assume straight-line). (e) Record the first month’s lease payment.

A laser triangulation system is used to determine the height of a steel block. The system has a photosensitive detector that is located 750.000 mm above the working surface and the laser is mounted at a 30.00° angle from the vertical. With no part on the worktable, the position of the laser reflection on the photo sensor is recorded. After a part is placed on the worktable, the laser reflection shifts 70.000 mm toward the laser. Determine the height of the object.

At December 31, 2014, Cascade Company had a net deferred tax liability of $450,000. An explanation of the items that compose this balance is as follows. Temporary Differences in Deferred Taxes Resulting Balances 1. Excess of tax depreciation over book depreciation. $200,000 2. Accrual, for book purposes, of estimated loss contingency from pending lawsuit that is expected to be settled in 2015. The loss will be deducted on the tax return when paid. $ (50,000) 3. Accrual method used for book purposes and installment method used for tax purposes for an isolated installment sale of an investment. $300,000 In analyzing the temporary differences, you find that $30,000 of the depreciation temporary difference will reverse in 2015, and $120,000 of the temporary difference due to the installment sale will reverse in 2015. The tax rate for all years is 40%. Instructions Indicate the manner in which deferred taxes should be presented on Cascade Company’s December 31, 2014, statement of financial position.

How do the properties of thermosetting polymers differ from those of thermoplastics?

Leon Tyler’s VISA balance is $793.15. He may pay it off in 12 equal end-of-month payments of $75 each. What interest rate is Leon paying?

dentify three ways taxpayers can pay their income taxes to the government.

Describe what is meant by qualified business income for purposes of the deduction for qualified business income.

Indicate which of the following costs should be expensed when incurred. (a) $13,000 paid to rearrange and reinstall machinery. (b) $200,000 paid for addition to building. (c) $200 paid for tune-up and oil change on delivery truck. (d) $7,000 paid to replace a wooden floor with a concrete floor. (e) $2,000 paid for a major overhaul on a truck, which extends the useful life.

Carla incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation’s stock. The property transferred to the corporation had the following fair market values and adjusted tax bases.     FMV    Adjusted Tax Basis Inventory$    20,000$        10,000 Building    150,000        100,000 Land    250,000        300,000 Total$  420,000$      410,000

In what situations do partners need to know the tax basis in their partnership interests?