Assuming that 2007 is a typical year for KimTech, in terms of profitability and compensation practices, evaluate the reasonableness of Kim's compensation package in light of the five factors enumerated in the Elliotts case. If audited by the IRS, will Kim's compensation be deemed reasonable? Why or why not? What can KimTech do to show that Kim's compensation is reasonable? The five factors under Elliotts case are (1) the employee's role in the company; (2) a comparison of the employee's salary with those paid by similar companies for similar services; (3) the character and condition of the company; (4) potential conflicts of interest; (5) evidence of an internal inconsistency in a company's treatment of payments to employees.”… http://ftp.resource.org/courts.gov/c/F3/221/221.F3d.1091.99-70164.html If audited by the IRS I think Mr. Kim's compensation would be deemed unreasonable.
Commissioner 84 F.2d, 453/455 1936 can be used in the analysis of Mr. Kim’s salary using the independent investor approach on equity. Unlike in the previous approach where it was proved that Kim’s salary is reasonable owing to the five factors enumerated in the Elliott case; this approach considers this salary unreasonable. According to the approach, the salary that the CEO gets is very high because it covers over 80% of the total profit the company makes. This is because; if the CEO gets all this money, there will be a serious effect on the returns on equity of the arm’s length investor. 26 U.S.C.
True B. False Question 22 of 50 1.0/ 1.0 Points Deciding that internal controls are effective when they in fact they are not is an example of assessing control risk too high. A. True B. False Question 23 of 50 1.0/ 1.0 Points The SEC is responsible for setting standards for not-for-profit organizations.
The Case of Dow Corning Corporation’ in Perspectives in Business ethics. What are some ethical and legal issues Dow Corning faced in considering filing for bankruptcy? DQ 5: What is meant by the team skimming? How can a company detect if skimming is occurring? What is meant by the term lapping?
In February 2011, the case is settled, and Joe refunds $2,500 to the customer. When Joe prepares his 2010 tax return in April 2011, he will include only $1,500 of net revenues from that customer. Your Answer: False The claim of right doctrine requires the recipient of disputed funds to recognize the income. Joe will include the full $4,000 in his 2010 taxable income because he had full control over the funds. He will be allowed to take a deduction on his 2011 tax return for the $2,500 repaid the customer.
Employees in exchange do a good job but loyalty to the company is the most important thing. One mega giant is Microsoft as a company they boast of integrity, honesty, openness, and personal excellence. The company holds itself accountable to their customers and all of their employees by providing the best product at the most economical price possible. Microsoft is focused on employee training as well as employee promotion from within. These guidelines are the reason that Microsoft feels the employees will do noting to jeopardize the
It is very important for Lawrence Sports to maintain a positive business relationship with their partners. Maintaining a positive relationship with suppliers and customers is a key entity in keeping the business successful. The finance manager has to ensure that the suppliers are being paid in a timely manner in regards to agreements, terms and conditions and he must also make sure the customers are paying Lawrence Sports in accordance to agreements, terms and conditions. This relationship works both ways and the finance manager must work diligently to ensure that Lawrence Sports obligations are met, so the company can pay their bills without
A code of conduct is a one of the major key factors in keeping a business in good ethical standing. Ever company should have a code laid out for all employees to view and understand. Code of Conduct: I. The success of our company is built on trust and credibility that we obtain by following through with commitments, and showing integrity and honesty. II.
ACCT 323 Assignment 1 Tax Research https://hwguiders.com/downloads/acct-323-assignment-1-tax-research/ ACCT 323 Assignment 1 Tax Research The facts for your Tax Research Assignment 1 are as follows: Mikki Jag is a self-employed rock star who hires you as his new CPA to prepare his 2014 federal income tax returns, which are currently on extension. He explains that in 2014 he spent $10,000 on special “flashy” clothes and outfits for his rock concerts. Mikki would like to deduct the cost of these clothes as work-related because the clothes are not acceptable to his sense of fashion on a daily basis. He would like to know under what circumstances he can deduct the cost of these work clothes. Instructions: Please research
Calculating Revenue. To be conservative, we assume no customers receive a refund which would equate to 1700 people x $80 to equal a revenue of $136,000. If we go strictly by averages, there is a potential of earning $432395 per tax season. This is figured by taking the average refund in Iowa ($2543.51) and multiplying by the set fee of 10%. We then