Question & Answer

Bingaman Resources sold two depreciable §1231 assets during the year. One asset resulted in a large gain (the asset was sold for more than it was purchased) and the other resulted in a small loss. Describe the §1231 netting process for Bingaman.

What are the two major groups of metals? Define them.

Compute MV Corp.’s 2024 taxable income given the following information relating to its current-year activities. Also, compute MV’s Schedule M-1 assuming that MV’s federal income tax expense for book purposes is $100,000.   • Gross profit from inventory sales of $500,000 (no book-tax differences). • Dividends MV received from 25 percent-owned corporation of $100,000 (assume this is also MV’s pro rata share of the distributing corporation’s earnings). • Expenses other than DRD, charitable contribution (CC), and net operating loss (NOL) are $350,000 (no book-tax differences). • NOL carryforward from 2023 of $10,000. • Cash charitable contribution of $120,000.

Explain the amortization convention applicable to intangible assets.

Suppose you asked your favorite AI learning tool “For purposes of §351, what constitutes property?” and the AI tool responded as follows: Is the AI response correct?  Explain.

Give two examples of machining operations in which generating and forming are combined to create workpart geometry.

Do investors in high tax brackets or those in low tax brackets benefit more from tax-exempt securities? Why? At a given point in time, which offers a higher before-tax yield: municipal bonds or corporate bonds? Why? Which has the higher after-tax yield? If taxes did not exist, would Treasury bonds offer a higher or lower yield than municipal bonds with the same maturity? Why? (LO1)

What is the purpose of annealing in glassworking?

Maria has all of her stock in Mayan Corporation redeemed. Under what conditions will Maria treat the redemption as an exchange and recognize capital gain or loss?

McCanna, Inc., has hired an investment company to manage its pension fund, which is invested in a stock portfolio and a bond portfolio. Explain how McCanna can evaluate the performance of the investment company in managing its pension fund money. (LO7)

'Transfer pricing is a waste of an entity’s resources; it all gets eliminated          on consolidation'. Discuss

What are some of the factors that influence a polymer's tendency to crystallize?

Hawkeye Corporation reports current E&P of $300,000 this year and accumulated E&P at the beginning of the year of $200,000. Hawkeye distributed $400,000 to its sole shareholder, Kinsella, on December 31 of this year. Kinsella’s tax basis in his Hawkeye stock before the distribution is $75,000.

A prototype of a part is to be fabricated using stereolithography. The part is shaped like a right triangle whose base = 36 mm, height = 48 mm, and thickness = 25 mm. In application, the part will stand on its base, which is 36 mm by 25 mm. In the stereolithography process, the layer thickness = 0.20 mm. The diameter of the laser beam (“spot size”) = 0.15 mm, and the beam is moved across the surface of the photopolymer at a velocity of 400 mm/s. Compute the minimum possible time required to build the part, if 8 sec are lost each layer to lower the height of the platform that holds the part. Neglect the time for postcuring.

This year, Sooner Corporation reports a deficit in current E&P of ($300,000).  Its accumulated E&P at the beginning of the year was $200,000. Sooner distributed $400,000 to its sole shareholder, Boomer, on June 30 of this year. Boomer’s tax basis in his Sooner stock before the distribution is $75,000.

What is the composite part concept in group technology?

What does it mean to characterize a gain or loss?  Why is characterizing a gain or loss important?

This year, Bobcat Corporation reports a deficit in current E&P of ($300,000) that accrued evenly throughout the year. At the beginning of the year, Bobcat’s accumulated E&P was $200,000. Bobcat distributed $200,000 to its sole shareholder, Melanie, on June 30 of this year. Melanie’s tax basis in her Bobcat stock before the distribution was $75,000.

Presented below are certain account balances of Paczki Products Co. Rent revenue $ 6,500 Sales discounts $ 7,800 Interest expense 12,700 Selling expenses 99,400 Beginning retained earnings 114,400 Sales revenue 390,000 Ending retained earnings 134,000 Income tax expense 31,000 Dividend revenue 71,000 Cost of goods sold 184,400 Sales returns and allowances 12,400 Administrative expenses 82,500 Allocation to noncontrolling interest 17,000 Instructions From the foregoing, compute the following: (a) total net revenue, (b) net income, (c) dividends declared, and (d) income attributable to controlling stockholders.

What is the difference between threading and tapping?

Name the four subsystems in a wire EDM process.

Presented below is a note disclosure for Matsui Corporation. Litigation and Environmental: The Company has been notified, or is a named or a potentially responsible party in a number of governmental (federal, state and local) and private actions associated with environmental matters, such as those relating to hazardous wastes, including certain sites which are on the United States EPA National Priorities List (“Superfund”). These actions seek clean-up costs, penalties and/or damages for personal injury or to property or natural resources. In 2014, the Company recorded a pre-tax charge of $56,229,000, included in the “Other expense (income)—net” caption of the Company’s consolidated income statements, as an additional provision for environmental matters. These expenditures are expected to take place over the next several years and are indicative of the Company’s commitment to improve and maintain the environment in which it operates. At December 31, 2014, environmental accruals amounted to $69,931,000, of which $61,535,000 are considered noncurrent and are included in the “Deferred credits and other liabilities” caption of the Company’s consolidated balance sheets. While it is impossible at this time to determine with certainty the ultimate outcome of environmental matters, it is management’s opinion, based in part on the advice of independent counsel (after taking into account accruals and insurance coverage applicable to such actions) that when the costs are finally determined they will not have a material adverse effect on the financial position of the Company. Instructions Answer the following questions. (a) What conditions must exist before a loss contingency can be recorded in the accounts? (b) Suppose that Matsui Corporation could not reasonably estimate the amount of the loss, although it could establish with a high degree of probability the minimum and maximum loss possible. How should this information be reported in the financial statements? (c) If the amount of the loss is uncertain, how would the loss contingency be reported in the financial statements?

Fuque Inc. uses the retail inventory method to estimate ending inventory for its monthly financial statements. The following data pertain to a single department for the month of October 2015. Inventory, October 1, 2015 At cost $ 52,000 At retail 78,000 Purchases (exclusive of freight and returns) At cost 272,000 At retail 423,000 Freight-in 16,600 Purchase returns At cost 5,600 At retail 8,000 Markups 9,000 Markup cancellations 2,000 Markdowns (net) 3,600 Normal spoilage and breakage 10,000 Sales revenue 390,000 Instructions (a) Using the conventional retail method, prepare a schedule computing estimated lower-of-cost-ormarket inventory for October 31, 2015. (b) A department store using the conventional retail inventory method estimates the cost of its ending inventory as $60,000. An accurate physical count reveals only $47,000 of inventory at lower-of-costor- market. List the factors that may have caused the difference between the computed inventory and the physical count.

What is dielectric strength as a material property?

Cougar Corporation is owned equally by Cat Stevens and a partnership that is owned equally by Cat’s father and two unrelated individuals. Cat and the partnership each owns 3,000 shares in Cougar. Cat wants to reduce his ownership in the company, and it is decided that Cougar will redeem 1,500 of his shares for $25,000 per share. Cat’s tax basis in each share is $5,000. What are the income tax consequences to Cat as a result of the stock redemption, assuming the company has earnings and profits of $10 million?