Question & Answer

Derive an expression for true strain as a function of D and Do for a tensile test specimen of round cross section, where D = the instantaneous diameter of the specimen and Do is its original diameter.

Horatio and Kelly were divorced at the end of last year.Neither Horatio nor Kelly remarried during the current year and Horatio moved out of state.Determine the filing status of Horatio and Kelly for the current year in the following independent situations: a.     Horatio and Kelly did not have any children and neither reported any dependents in the current year.   Horatio and Kelly will both file as single taxpayers.   b.    Horatio and Kelly had one child Amy, who turned 10 years of age in the current year.Amy lived with Kelly for all of the current year and Kelly provided all of her support.

A batch of annealed steel has just been received from the vendor. It is supposed to have a tensile strength in the range 60,000 - 70,000 lb/in2 . A Brinell hardness test in the receiving department yields a value of HB = 118. (a) Does the steel meet the specification on tensile strength? (b) Estimate the yield strength of the material.

Daniel is considering selling two stocks that have not performed well over recent years. A friend recently informed Daniel that one of his stocks has a special designation, which allows him to treat a loss up to $50,000 on this stock as an ordinary loss rather than the typical capital loss. Daniel figures that he has a loss of $60,000 on each stock. If Daniel’s marginal tax rate is 35 percent and he has $120,000 of other capital gains (taxed at 15 percent), what is the tax savings from the special tax treatment?

Trevor is a single individual who is a cash-method, calendar-year taxpayer. For each of the next two years (2024 and 2025), Trevor expects to report salary of $80,000, contribute $8,000 to charity, and pay $2,800 in state income taxes. a. Estimate Trevor’s taxable income for 2024 and 2025 using the 2024 amounts for the standard deduction for both years. b. Now assume that Trevor combines his anticipated charitable contributions for the next two years and makes the combined contribution in December of 2024. Estimate Trevor’s taxable income for each of the next two years using the 2024 amounts for the standard deduction. Reconcile the total taxable income to your solution to part (a). c. Trevor plans to purchase a residence next year, and he estimates that additional property taxes and residential interest will cost $2,000 and $12,000, respectively, each year. Estimate Trevor’s taxable income for each of the next two years (2024 and 2025) using the 2024 amounts for the standard deduction and also assuming Trevor makes the charitable contribution of $8,000 and state tax payments of $2,800 in each year. d. Assume the facts in part (c) but that Trevor makes the charitable contribution for 2025 in December of 2024. Estimate Trevor’s taxable income for 2024 and 2025 using the 2024 amounts for the standard deduction. Reconcile the total taxable income to your solution to part (c). e. Explain the conditions in which the bunching strategy in part (d) will generate tax savings for Trevor.

Will Smith will receive $80,000 on December 31, 2019 (5 years from now), from a trust fund established by his father. Assuming the appropriate interest rate for discounting is 12% (compounded semiannually), what is the present value of this amount today?

Provide an example of an expense associated with the production of tax-exempt income and explain what might happen if Congress repealed the prohibition against deducting expenses incurred to produce tax-exempt income.

Define and sketch a fillet weld.

Approximately what percentage of tax returns does the IRS audit?  What are the implications of this number for the IRS’s strategy in selecting returns for audit?

A department within a processing operation has some finished units physically on hand. Should they be counted as completed units or as ending inventory in the department? Explain.

If increased investment (using current technology) does not lead to increased long-run economic growth, does it bring any benefits?

In recent years, many banks have been relying more heavily on noninterest income as a proportion of their total income. Write a short essay explaining whether banks that rely more heavily on noninterest income will have better or worse performance than banks that rely more heavily on traditional sources of income (such as loans)?

Since fixed-rate mortgages and bonds have similar payment flows, how is a financial institution with a large portfolio of fixed-rate mortgages affected by rising interest rates? Explain. LO(8-1)

The TimpRiders LP has operated a motorcycle dealership for a number of years. Amir is the limited partner, Francesca is the general partner, and they share capital and profits equally. Francesca works full time managing the partnership. Both the partnership and the partners report on a calendar-year basis. At the start of the current year, Amir and Francesca had bases of $10,000 and $3,000 respectively, and the partnership did not have any liabilities. During the current year, the partnership reported the following results from operations: Net sales $650,000 Cost of goods sold $500,000 Operating expenses $160,000 Short-term capital loss $2,000 Tax-exempt interest $2,000 §1231 gain $6,000 On the last day of the year, the partnership distributed $3,000 each to Amir and Francesca. a. What outside basis do Amir and Francesca have in their partnership interests at the end of the year? b. How much of their losses are currently not deductible by Amir and Francesca because of the tax-basis limitation? c. To what extent does the passive activity loss limitation apply in restricting their deductible losses for the year? d. Using the information provided, prepare TimpRiders’ page 1 and Schedule K to be included with its Form 1065 for the current year. Also, prepare a Schedule K-1 for Amir and Francesca.

Presented below are comments made in the financial press. Instructions Prepare responses to the requirements in each item. (a) Rep. John Dingell, at one time the ranking Democrat on the House Commerce Committee, threw his support behind the FASB’s controversial derivatives accounting standard and encouraged the FASB to adopt the rule promptly. Indicate why a member of Congress might feel obligated to comment on this proposed FASB standard. (b) In a strongly worded letter to Senator Lauch Faircloth (R-NC) and House Banking Committee Chairman Jim Leach (R-IA), the American Institute of Certified Public Accountants (AICPA) cautioned against government intervention in the accounting standard-setting process, warning that it had the potential of jeopardizing U.S. capital markets. Explain how government intervention could possibly affect capital markets adversely.

What is a terminal block?

What is centerless grinding?

74. Fizbo Corporation is in the business of breeding and racing horses. Fizbo has taxable income of $5,000,000 other than from these transactions. It has nonrecaptured §1231 losses of $10,000 from 2020 and $13,000 from 2018.    Consider the following transactions that occur during 2024: a. A building with an adjusted basis of $300,000 is totally destroyed by fire. Fizbo receives insurance proceeds of $400,000 but does not plan to replace the building. The building was built 12 years ago at a cost of $420,000 and was used to provide lodging for employees.  b. Fizbo sells four acres of undeveloped farmland (used for grazing) for $50,000. Fizbo purchased the land 15 years ago for $15,000. c. Fizbo sells a racehorse for $250,000. The racehorse was purchased four years ago for $200,000. Total depreciation taken on the racehorse was $160,000.  d. Fizbo exchanges equipment that was purchased three years ago for $300,000 for $100,000 of IBM common stock. The adjusted basis of the equipment is $220,000. If straight-line depreciation had been used, the adjusted basis would be $252,000. e. On November 1, Fizbo sold XCON stock for $50,000. Fizbo had purchased the stock on December 12, 2023, for $112,000.   Part (1): After all netting is complete, what is Fizbo’s total amount of income from these transactions to be treated as ordinary income or loss? What is its capital gain or loss?   Part (2):  What is Fizbo’s taxable income for the year after including the effects of these transactions?

Describe the types of expenses that constitute miscellaneous itemized deductions and explain why these expenses rarely produce any tax benefits.

The unit melting energy for a certain sheet metal is 9.5 J/mm3. The thickness of each of the two sheets to be spot welded is 3.5 mm. To achieve required strength, it is desired to form a weld nugget that is 5.5 mm in diameter and 5.0 mm thick. The weld duration will be set at 0.3 sec. If it is assumed that the electrical resistance between the surfaces is 140 micro-ohms, and that only one-third of the electrical energy generated will be used to form the weld nugget (the rest being dissipated), determine the minimum current level required in this operation.

Addison Co. has one temporary difference at the beginning of 2014 of $500,000. The deferred tax liability established for this amount is $150,000, based on a tax rate of 30%. The temporary difference will provide the following taxable amounts: $100,000 in 2015, $200,000 in 2016, and $200,000 in 2017. If a new tax rate for 2017 of 20% is enacted into law at the end of 2014, what is the journal entry necessary in 2014 (if any) to adjust deferred taxes?

The following facts pertain to a noncancelable lease agreement between Mooney Leasing Company and Rode Company, a lessee. Inception date: May 1, 2014 Annual lease payment due at the beginning of each year, beginning with May 1, 2014 $21,227.65 Bargain-purchase option price at end of lease term $ 4,000.00 Lease term 5 years Economic life of leased equipment 10 years Lessor’s cost $65,000.00 Fair value of asset at May 1, 2014 $91,000.00 Lessor’s implicit rate 10% Lessee’s incremental borrowing rate 10% The collectibility of the lease payments is reasonably predictable, and there are no important uncertainties surrounding the costs yet to be incurred by the lessor. The lessee assumes responsibility for all executor costs. Instructions (Round all numbers to the nearest cent.) (a) Discuss the nature of this lease to Rode Company. (b) Discuss the nature of this lease to Mooney Company. (c) Prepare a lease amortization schedule for Rode Company for the 5-year lease term. (d) Prepare the journal entries on the lessee’s books to reflect the signing of the lease agreement and to record the payments and expenses related to this lease for the years 2014 and

Explain how underwriters use the overallotment option in IPOs. (LO3)

What is a carbon nanotube?

Using the IS/MP model analyse the possible effect of an increase in aggregate expenditure on output, the real interest rate and inflation.