Like the partnerships the S-corporations basically have no federal income taxes. S-corporations owners are taxed on their portion of earnings. The popularity of S-corporations fluctuate with the income tax law. Sometimes the corporation taxes are more than the individual and vice versa. Some of the similarities to a closely held corporation is each shareholder's liability is limited to the amount of their investment.
Several factors including number and frequency of transactions increase the risk of error. Frauds can be through fraudulent financial reporting or misappropriation of assets (Boynton & Johnson, 2006). In the simulation, the 100% audited accounts were cash, intangibles, lines of credit, and paid in share capital. Why is materiality allocated only to those accounts that are sampled? Materiality is allocated only to those accounts sampled because the 100% verified accounts have no audit risk so materiality is not a factor (Apollo Group, 2004).
LIT1 Task 1 SOLE PROPRIETORSHIP: As the first word in the name suggests there is no distinction between the owner and the business, legally they are viewed as one entity. When it comes to starting a business this option is a perfect one because there is little to no start-up cost and autonomy since it is now your sole responsibility. The main disadvantage to this type of business is that financially the owner may find it hard to start up because any money that I loaned is a personal loan. • LIABILITY – The owner (proprietor) is liable for all debts and profits the business is and vice versa. The business and the owner are one entity so when the business owes on a debt the owner’s personal assets are liable to be taken as payment
Your personal assets are not subject to claims of the corporation’s creditors, only your investments in the corporation are subject to any claims. As for the $25,000 because it is directly related to expense paid upfront by your business and taxation has already occurred not tax liability should be assessed to this amount. For tax purposes
Less important issues are handled by means of a correspondence audit. If a taxpayer disagrees with the IRS auditor's finding, the only resort is to use the courts. Special agents are assigned to an audit only when fraud might be involved (choice B). Self-employed persons have more flexibility in manipulating income and deductions than do employed taxpayers (choice C). The next step after an initial audit would be the Appeals Division within the IRS (choice E).
the general ledger include cash, account payable, accountant receivables and common stock. In the subsidiary ledger consists of customers and creditors. The purpose of the control account is to keep the general ledger free of unnecessary information yet have the correct balance for the financial statements. The advantages of using the subsidiary ledgers it keeps account information up to date and holds account information in one transaction another advantage is that it does not have unnecessary information in the journey only what is need it frees up the ledger. It also help pin point errors by focus more on one personal account other than any different ones.
A positive side to these transfer taxes is that “it takes lifetime transfers into account to determine the tax on assets transferred at death” (Spilker, Ayers, Robinson, Outslay & Worsham, 2013, pg. 25-3) Gift taxes are in a sense a prepayment of the estate tax. Despite the disagreements about the estate and gift taxes, the government does provide certain ways around these taxes. Most taxpayers will not actually have to pay an estate tax
|pays the rest. In this case, the| | |required to pay taxes and this | |organizations do not record the | | |affects their financial statements. | |money gotten from the charges as| | |The ownership of for profit | |revenue as they do not get the | | |organizations can be transferred and | |whole amount just lie for profit| | |thus, financial reports can be | |organizations | | |prepared for the stockholders. | |
Blades revenues derive mainly from short-haul customer transportation and short-haul cargo transportation. For short-haul customer transportation and short-haul cargo transportation, revenues are recognized on the collection of payment. However, to comply with IFRS, we have to determine when the critical event needed to recognize revenue takes place; this is not necessarily when collection happens. Although cash is paid by customers, the performance has not been completed, and this does not meet the definition of revenue in accrual accounting basis. On the other hand, revenue can be recognized before payment is made.
The general sales manager is held accountable for net profit. Obviously, the dealership also keeps track of balance sheet items, but the dealership general manager’s incentives do not seem to consider them. So is the general manager an investment center manager? Regarding performance measurement : The departments are profit centers, but not all costs are allocated to them. They are more like “gross profit centers.” The salespeople are held accountable for gross profit on the deals they initiate, so each salesperson is also a little profit center.