Under the constructive receipt doctrine, Reg.1.451-2, the payment is considered income for the current year because the earnings were under the restriction of a successful verdict for your client, and so the payment could not be considered as earned any earlier. Since the company operates as an LLC, all income passes through the owner as ordinary income, after business exclusions and deductions, IRC Code Sec.752. And so, the earnings from will be subject to self-employment tax, FICA, and Medicare tax. 1B. How is the $25,000 treated for purposes of federal tax income?
While the current liability dropped from 25.6% in 2003 to 24.3% in 2004, it is apparent that this company has allocated for this as a long-term debt since it rose from 23% of total liabilities in 2003 to 26.4% in 2004. Lucent Technologies equity structure enhanced from a shortage representing a negative in their total liabilities and shareholder’s equity in the year of 2003 when it is compared to the year of 2004. Their equity position would be considered a deficit, but becomes less of an issue as the years pass. Lucent Technologies Case P.3 3. What concerns would investors and creditors have based on only this information?
It would be my advice for Mr. Jones to not buy the stock because of the liability of current and future tax obligations which Mr. Jones would incur from the purchase of the stock. Since the tax identity of Smithon corporation would have not ceased, it is not a favorable purchase for Mr. Jones. Ina a case where the tax identity of a firm does not cease not to exist, the tax aspects will remain the same and so will the existing tax schedule. So in this case it would mean that Mr. Jones would not be allowed to change the financial year to end on December 31. The buyer in cases where he can’t change the legal entity is in a non -benefice situation, the buyer is limited to follow the current tax basis on the company’s assets even if the buyer paid more for the
There is a strong relationship between average dollar amount and recency. The more recent (with 1 being the most recent) a customer purchases, the higher average dollar amount ordered is for that customer. 5. What does a bar chart of Average $ ordered from last catalog by frequency deciles show? This shows that average dollar amount ordered from last catalog is negatively related to frequency.
You can deduct gambling losses on your tax return only if you itemize tax deductions and only to the extent of your gambling winnings. Claim your gambling losses as a miscellaneous tax deduction on Schedule a of Form 1040. It is important to keep an accurate diary or similar record of your gambling winnings and gambling losses. To deduct your gambling losses on your tax return, you must be able to provide receipts, tickets, statements or other records that show the amount of both your gambling winnings and gambling losses. You cannot deduct or carry forward a net gambling loss on your tax return; even if you are a professional
A. $181,000 B. $221,000 C. $263,000 D. $243,000 4. Based on the preceding information, immediately after the transfer, A. Conservative's total assets decreased by $23,000.
Problem 17-15 on Distribution to Shareholders based on Chapter 17 Payout Policy Suppose that all capital gains are taxed at a 25% rate and that the dividend tax rate is 50%. Arbuckle Corporation is currently trading for $30 and is about to pay a $6 special dividend. a. Absent any other trading frictions or news, what will its share price be just after the dividend is paid? Suppose Arbuckle made a surprise announcement that it would do a share repurchase rather than pay a special dividend.
It is evident that Target Corporation was capable of meeting its current liabilities since the current assets exceeded the current liabilities. The financial crisis causes the increase of the working capital between 2004 and 2005 but a substantial decline of the same between 2005 and 2006. Current ratio 2002 – 2004: Current ratio = Current assets/Current liabilities 2006 Current ratio = $14,405./$9,508. =1.52:1 2005 Current ratio = $13,922./$8,220 =1.69:1 2004 Current ratio = $12,952./$8,314. =1.56:1 Just like the working capital Target Corporation current ratio slightly increased between 2004 and 2005 reaching 1.69:1 but declined between 2005 and 2006 to stand at 1.52:1.
This would explain the difference in gross profit and sales revenue. 2. The economy seems to be a concern as; people are not flocking to the best of the best any longer and may be searching for alternative products. In tough times even a strong market share can erode with the search for comparable products at a lessor price. It appears that this very issue may be vexing Elite.
When the government prevents prices from adjusting naturally to supply and demand, efficiency is improved in the economy. ANSWER: F TYPE: T KEY1: D SECTION: 2 OBJECTIVE: 7 RANDOM: Y [cxviii]. A market economy cannot possibly produce a socially desirable outcome because individuals are motivated by their own selfish interests. ANSWER: F TYPE: T KEY1: D SECTION: 2 OBJECTIVE: 7 RANDOM: Y [cxix]. While the invisible hand cannot guarantee efficiency, it is better at guaranteeing equity.