ACC 105 - Chapter 1 Questions with Correct Answers
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Course
Accounting bachelors
Institution
Accounting Bachelors
Clay purchased Elm Corporation stock twenty years ago for $29,000. In the current year, he sells the stock for $10,000. What is Clay's gain or loss? Correct Answer-$19,000 long-term
Which of the following is not a capital asset? Correct Answer-Inventory
Alan, whose wife died in Year A, filed ...
ACC 105 - Chapter 1 Questions with Correct Answers
Clay purchased Elm Corporation stock twenty years ago for $29,000. In
the current year, he sells the stock for $10,000. What is Clay's gain or
loss? Correct Answer-$19,000 long-term
Which of the following is not a capital asset? Correct Answer-Inventory
Alan, whose wife died in Year A, filed a joint tax return for Year A.
During Year B, he did not remarry and continued to maintain his home
in which his four dependent children lived. In the preparation of his tax
return for Year B, Alan should file as: Correct Answer-Qualifying
widow(er)
Which of the following provisions was passed by Congress to meet an
economic goal of the tax law? Correct Answer-The moving expense
deduction for adjusted gross income
Which of the following statements is not correct with respect to the
calculation of the phase out of the exemption deduction? Correct
Answer-Except for married taxpayers filing separate returns, the
exemption deduction phase out begins at the same level of adjusted
gross income regardless of filing status.
All of the following factors are important in determining whether an
individual is required to file an income tax return, except: Correct
Answer-The taxpayer's total itemized deductions
, John, age 25, is a full-time student at a state university. John lives with
his sister, Ann, who provides over half of his support. His only income
is $4,000 of wages from a part-time job at the college book store. What
is Ann's filing status for the current tax year? Correct Answer-Single
Ronald is 92 years old and in poor health. Clever investing earlier in his
life has left him with a sizeable income. He is able to support his son Ed.
Ed is 67 years old and a bit "confused," so he lives in a home for the
aged. How many exemptions should Ronald claim on his tax return?
Correct Answer-2
An unmarried taxpayer who maintains a household for a dependent child
and whose spouse died in the prior year should file as: Correct Answer-
Qualifying widow or widower
Which one of the following provisions was passed by Congress to meet
a social goal of the tax law? Correct Answer-The medical expense
deduction
Which of the following relatives will not satisfy the relationship test for
the dependency exemption? Correct Answer-All are correct and satisfy
the test
During the current tax year, Howard maintained his home in which he
and his sixteen-year-old son resided. The son qualifies as his dependent.
Howard's wife died in the prior tax year. What is his filing status for the
current tax year? Correct Answer-Qualifying widow or widower
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