REG (CPA) Exam Questions and
Answers 100% Pass | Already Graded A+
How do you calculate the deductible loss for a partner in a partnership? -
Beg Basis
+ Net LT capital gain
- Cash distributions
= Basis for determining allowable loss deduction
- Loss i limited to partner's basis.
What is th...
Situations that terminate an S corporation: - ✔✔- having corporation or
partnership as shareholder
- having more than 100 shareholders
- having shareholder that is non US citizen
Which of the following debtors are not eligible for relief under the Chapter
11 bankruptcy code? - ✔✔stockbrokers
What are tax exempt items ? - ✔✔interest on state and local bonds
What is considered a US shareholder of a controlled foreign corporation? -
✔✔A U.S person who owns at least 10% of stock value OR voting stock
Capital Loss - individual - ✔✔- deduction is limited to $3,000 per year with
excess carried forward indefinitely
Which individuals cannot be involuntarily petitioned into bankruptcy? -
✔✔Farmers
, Filling out form 1040 - ✔✔Line 1 wages: W2
Line 2b taxable interest: Schedule K-1 interest income
Line 8 and Line 10 and Line 13 : calculated from schedule 1
How is income from transfer of partnership interest treated when a person
receives interest in partnership for services provided? - ✔✔The interest is
valued at
- (% of interest) X FMV of partnership
- ordinary income
Consolidated Income statement - ✔✔- Capital gains, charitable
contributions, and dividends received are determined at the consolidated
level
Rescission - ✔✔a method by which the parties of a contract are restored to
their original position.
Novation - ✔✔one party accepts the performance pf a third party in place of
the party obligated to perform under the original contract
- usually done when promoter creates liabilities pre-existing of corporation
formation
Itemized deductions for individuals (schedule A) - ✔✔- state income taxes
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