1. A contingent loss should be reported in a footnote to the financial statements rather than being accrued if: (Points : 1)

MULTIPLE CHOICE

1. A contingent loss should be reported in a footnote to the financial statements rather than being accrued if: (Points : 1)

2. Which of the following investment securities held by Zoogle Inc. may be classified as held-to-maturity securities in its balance sheet? (Points : 1)

3. Large, highly rated firms sometimes sell commercial paper: (Points : 1)

4. Which of the following increases the investment account under the equity method of accounting? (Points : 1)

5. When the equity method of accounting for investments is used by the investor, the investment account is increased when: (Points : 1)

6. Which of the following is a contingency that would most likely require accrual? (Points : 1)

7. When a product or service is delivered for which a customer advance has been previously received, the appropriate journal entry includes: (Points : 1)

8. Other things being equal, most managers would prefer to report liabilities as noncurrent rather than current. The logic behind this preference is that the long-term classification permits the company to report: (Points : 1)

9. The key accounting considerations relating to accounts payable are: (Points : 1)

10. The investment category for which the investor's "positive intent and ability to hold" is important is: (Points : 1)

Click here for the solution: 1. A contingent loss should be reported in a footnote to the financial statements rather than being accrued if: (Points : 1)

For its 2010 tax year, Ilex Corporation has ordinary income of $240,000, a short-term capital loss of $60,000, and a long-term capital gain of $20,000

For its 2010 tax year, Ilex Corporation has ordinary income of $240,000, a short-term capital loss of $60,000, and a long-term capital gain of $20,000. Calculate Ilex Corporation's tax liability for 2010.


Click here for the solution: For its 2010 tax year, Ilex Corporation has ordinary income of $240,000, a short-term capital loss of $60,000, and a long-term capital gain of $20,000

Palmer, Inc. has a net operating loss carryforward of $100,000

Palmer, Inc. has a net operating loss carryforward of $100,000. If Palmer continues its business with no changes, it will have $50,000 of taxable income (before the NOL) in both 2013 and 2014. If Palmer decides to invest in a new product line instead, it expects to have taxable income of $70,000 in 2013 and 2014. What marginal tax rate does the new product line face in 2013 and in 2014?

Click here for the solution: Palmer, Inc. has a net operating loss carryforward of $100,000