ACC/307 ACC307 ACC 307 WEEK 9 QUIZ

ACC 307 WEEK 9 QUIZ

1.

TF Qu. 13 Taxpayers can recognize a taxable gain even ...

Taxpayers can recognize a taxable gain even though an asset's real economic value has declined.

2.

TF Qu. 20 Unrecaptured §1250 gains apply only to ...

Unrecaptured §1250 gains apply only to individuals.

3.

MC Qu. 49 Which of the following gains does not result...

Which of the following gains does not result solely in an ordinary gain or loss?

Sale of equipment held for less than a year.

Sale of inventory.

Sale of equipment where the accumulated depreciation exceeds the gain realized.

Sale of equipment where the gain realized exceeds the accumulated depreciation.

None of these.

4.

MC Qu. 48 Which of the following is true regarding dep...

Which of the following is true regarding depreciation recapture?

Changes the amount of a gain.

Changes the character of a gain.

Only applies to ordinary assets.

None of these.

5.

MC Qu. 70 Koch traded machine 1 for machine 2. Koch or...

Koch traded machine 1 for machine 2. Koch originally purchased machine 1 for $75,000 and machine 1's adjusted basis was $40,000 at the time of the exchange. Machine 2's seller purchased it for $65,000 and machine 2's adjusted basis was $55,000 at the time of the exchange. What is Koch's adjusted basis in machine 2 after the exchange?

None of these.

$55,000.

$75,000.

$40,000.

$50,000.

6.

TF Qu. 37 Flexible spending accounts allow employees t...

Flexible spending accounts allow employees to set aside before-tax dollars for medical and dependent care expenses.

7.

TF Qu. 34 Employees may exclude from income items suc...

Employees may exclude from income items such as occasional theatre tickets, t-shirts, or a Thanksgiving turkey.

8.

MC Qu. 78 Lara, a single taxpayer with a 30 percent ma...

Lara, a single taxpayer with a 30 percent marginal tax rate, desires health insurance. The health insurance would cost Lara $5,000 to purchase if she pays for it herself (Lara's AGI is too high to receive any tax deduction for the insurance as a medical expense). Lara's employer has a 40 percent marginal tax rate. Ignoring payroll taxes, what is the maximum amount of before-tax salary Lara would give up to receive health insurance?

$8,333.

$1,500.

$7,143.

$5,000.

9.

MC Qu. 47 Which of the following is not a purpose of e...

Which of the following is not a purpose of equity-based compensation?

Provide risk and incentives to employees.

Avoid compensation limits for executives.

Motivate employees by aligning employee and employer incentives.

Provides a low or no cost form of compensation.

10.

MC Qu. 63 Bonnie's employer provides her with an annual dinner club membership...

Bonnie's employer provides her with an annual dinner club membership costing $5,000. Her marginal tax rate is 25 percent. Her employer has a marginal tax rate of 35 percent. What is Bonnie's after-tax benefit?

$1,250.

$5,000.

$0.

$3,750.