Premium Essay

Ch1 of Tax Business

In: Business and Management

Submitted By sunhaoming
Words 6008
Pages 25

Question/ Problem 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

Learning Objective LO 1 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 2 LO 3

Topic Revenue neutrality Controlling the economy Encouraging industries Research and development expenditures Social considerations Earned income credit Charitable contributions Fines and penalties Home ownership Higher education incentives Tax credit versus deduction Alleviating the effect of multiple taxation Double taxation and effect of a credit versus a deduction Wherewithal to pay concept: transfer to controlled corporation Avoiding the corporate income tax Wherewithal to pay: example Recognized gain versus realized gain: amount Like-kind exchange versus involuntary conversion: losses Settlement time period Installment method Keogh Plan: grace period Bracket creep: indexation Community property states Community property states Deterrence provisions $13,000 annual gift tax exclusion: audit

Status: Present Edition New New New New New Unchanged Unchanged Unchanged Unchanged Unchanged Unchanged Unchanged Unchanged Modified Modified New New New New New New New New New New New

Q/P in Prior Edition

6 7 8 9 10 11 12 13 14 15

Instructor: For difficulty, timing, and assessment information about each item, see p. 1-3.

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.


2012 Corporations Volume/Solutions Manual Status: Present Edition New Modified New New New New Modified Modified Unchanged Unchanged New Modified Modified Unchanged New Modified Modified New Unchanged Unchanged Unchanged New Modified Unchanged New…...

Similar Documents

Free Essay

Business Tax

...第四章 营业税法 营业税法是指国家制定的用以调整营业税征收与缴纳之间权利及义务关系的法律规范。营业税是对在我国境内提供应税劳务、转让无形资产和销售不动产的行为为课税对象所征收的一种税。现行营业税的基本规范,是1993年l2月13日国务院颁布的《中华人民共和国营业税暂行条例》(以下简称《营业税暂行条例》)。 第一节 纳税义务人与扣缴义务人 一、纳税义务人 (一)纳税义务人的一般规定 在中华人民共和国境内提供应税劳务、转让无形资产或者销售不动产的单位和个人,为营业税的纳税人。 在中华人民共和国境内是指税收行政管辖权的区域。具体情况为: 1.所提供的劳务发生在境内 ; 2.在境内载运旅客或货物出境; 3.在境内组织旅客出境旅游; 4.转让的无形资产在境内使用; 5.所销售的不动产在境内; 6.在境内提供保险劳务。 上述应税劳务是指属于交通运输业、建筑业、金融保险业、邮电通信业、文化体育业、娱乐业、服务业科目征收范围的劳务。加工和修理修配劳务属于增值税的征税范围,因此不属于营业税的应税劳务。单位或个体经营者聘用的员工为本单位或雇主提供的劳务,也不属于营业税的应税劳务。 上述保险劳务:一是指境内保险机构为境内标的物提供的保险,不包括境内保险机构为出口货物提供的保险;二是指境外保险机构以在境内的物品为标的物所提供的保险。 提供应税劳务、转让无形资产或者销售不动产是指有偿提供应税劳务、有偿转让无形资产或者有偿销售不动产的行为。有偿是指通过提供、转让或销售行为取得货币、货物或其他经济利益。 单位是指国有企业、集体企业、私有企业、股份制企业、外商投资企业、外国企业、其他企业、行政单位、事业单位、军事单位和社会团体等。个人是指个体工商户以及其他有经营行为的中国公民和外国公民。 (二)纳税义务人的特殊规定 1.铁路运输的纳税人:(1)中央铁路运营业务的纳税人为铁道部。(2)合资铁路运营业务的纳税人为合资铁路公司。(3)地方铁路运营业务的纳税人为地方铁路管理机构。(4)铁路专用线运营业务的纳税人为企业或其指定的管理机构。(5)基建临管线铁路运营业务的纳税人为基建临管线管理机构。 2.从事水路运输、航空运输、管道运输或其他陆路运输业务并负有营业税纳税义务的单位,为从事运输业务并计算盈亏的单位。从事运输业务并计算盈亏的单位是指具备以下条件:一是利用运输工具,从事运输业务,取得运输收入;二是在银行开设有结算账户;三是在财务上计算营业收入、营业支出、经营利润。 3.企业租赁或承包给他人经营的,以承租人或承包人为纳税人。承租人或承包人是指有独立的经营权,在财务上独立核算,并定期向出租者或发包者上缴租金或承包费的承租人或承包人。 4.建筑安装业务实行分包或转包的,分包或转包者为纳税人。 5.金融保险业纳税人包括: (1)银行,包括人民银行、商业银行、政策性银行。 (2)信用合作社。 (3)证券公司。 (4)金融租赁公司、证券基金管理公司、财务公司、信托投资公司、证券投资基金。 (5)保险公司。 (6)其他经中国人民银行、中国证监会、中国保监会批准成立且经营金融保险业务的机构等。 二、扣缴义务人 在现实生活中,有些具体情况难以确定纳税人,因此税法规定了扣缴义务人。营业税的扣缴义务人主要有以下几种: (一)委托金融...

Words: 2424 - Pages: 10

Premium Essay

Role of Accounting on Business Behavior Impacted by Tax Changes in Malaysia

...accounting on business behaviors impacted by tax changes in Malaysia Justification There are many factors influence the changes of accounting importance where the role of accounting evolves along with the business changes affected by these factors. One of the factors that affect role of accounting in business field is tax. In Malaysia, Tax is generally divided into 2 types which are direct and indirect tax. Direct tax can be defined as tax which is imposed straight to the taxpayer. In short, the payment of tax is between taxpayer towards government. Examples of direct tax are income tax from employee salary, corporation tax, property tax, and etc. Meanwhile, indirect tax is a type of charge that can be transferred to the other person. A good example of indirect tax is restaurant that collect tax charge of the food’s sold from the customer (sales tax). Other examples of indirect tax are custom duty, central excise duty, and service tax). In brief, the history of Malaysia tax was started with more dependency towards indirect tax where establishment of direct tax has only started to take effect from 1 January 1948. This establishment has changed the trend of Malaysia tax which depends more and more on direct tax until today. In 2009 itself, government revenue has grown to 48.6% from direct tax. The urgency of understanding changes in accounting role due to tax, become important because of several reasons. Firstly, as the globalization of the economy develops further, tax......

Words: 1847 - Pages: 8

Premium Essay

Ch1 Mis

...Essentials of Systems Analysis and Design, 5e (Valacich/George/Hoffer) Chapter 1 The Systems Development Environment 1) The end user is not the person in the organization most involved in the systems analysis and design process. Answer: TRUE Diff: 2 Page Ref: 3 2) Systems analysis is the second phase of the systems development life cycle. Answer: TRUE Diff: 2 Page Ref: 3 3) The main goal of systems analysis and design is to improve organizational systems, typically through applying software that can help employees accomplish key business tasks more easily and efficiently. Answer: TRUE Diff: 2 Page Ref: 4 4) Components are parts, or aggregation of parts of the system. Answer: TRUE Diff: 1 Page Ref: 7 5) A boundary is the point of contact where a system meets its environment or where subsystems meet each other. Answer: FALSE Diff: 2 Page Ref: 7 6) An information system interacts with its environment when it processes data. Answer: FALSE Diff: 2 Page Ref: 7 7) An interface separates a system from other systems. Answer: FALSE Diff: 2 Page Ref: 7 8) A system's environment is everything outside a system's boundary that influences the system. Answer: TRUE Diff: 1 Page Ref: 7 9) Interfaces exist between subsystems. Answer: TRUE Diff: 1 Page Ref: 7 10) A system's capacity can be viewed as a system constraint. Answer: TRUE Diff: 2 Page Ref: 7 11) Cohesion is the process of...

Words: 4614 - Pages: 19

Premium Essay

Commencement & Cessation of a Business - a Tax Perspective

...PART A INTRODUCTION The issue that the Inland Revenue Department (IRD) is disputing is whether Owen was considered to be in business during the years ended March 2008 and 2009. To determine this, we need to look at the definition of a business and compare the facts in Owen’s case to conclude whether a business exists. In considering this, we will need to determine the dates of commencement and cessation for the business (if it is in fact a business) to help us decide the period in which expenses can be claimed. DEFINITON OF A BUSINESS The Income Tax Act (ITA) 2007 defines business income as “An amount that a person derives from a business is income of that person” (Income Tax Act (ITA) 2007. s.CB 1(1)). Furthermore, a business is defined under s. YA 1 (ITA 2007) as “any profession, trade or undertaking carried on for profit”, however the actual accomplishment of profit is not the sole requirement in establishing whether a business exists or not. Whether Owen is engaged in a business comes down to a two-fold test for a business, formulated by Richardson J in the case of Grieve v CIR (1984) 1 NZLR 101 (CA), which involves asking: a) About the nature of the activities carried on (not a hobby or pastime). b) About the intention of the taxpayer engaged in those activities. When looking at the (a) nature of the activity, we have to consider; the period over which the person engages in the activity, the commitment of time, money and......

Words: 1779 - Pages: 8

Free Essay

Business Communication Today, 11e (Bovee/Thill) Ch1 Answers

...Business Communication Today, 11e (Bovee/Thill) Chapter 1 Achieving Success Through Effective Business Communication 1) Communication is the process of A) transferring information and meaning. B) listening actively. C) writing messages. D) none of the above. Answer: A Explanation: A) Communication is a two-way process that begins with the sender and ends when the receiver acquires information and meaning. Diff: 2 Page Ref: 3 Skill: Concept Objective: 1 AACSB: Communication Abilities 2) When it comes to communication skills, employers express particular frustration with A) experienced workers who shun new technologies. B) recent college graduates who haven't learned how to adapt to a professional environment. C) employees whose first language is not English. D) male workers. Answer: B Explanation: B) Employers expect employees to speak and write in a professional manner that is clear, direct, and free of slang, jargon, and other inappropriate terms. Diff: 1 Page Ref: 3 Skill: Concept Objective: 2 AACSB: Communication Abilities 3) Stakeholders affected by the quality of business communication include A) customers. B) employees. C) suppliers. D) all of the above. Answer: D Explanation: D) Stakeholders include anyone who is impacted by a company in a direct or indirect way. Customers, suppliers, and employees are all stakeholders, as are shareholders, community members, and the wider world. Diff: 2 Page Ref:......

Words: 8534 - Pages: 35

Premium Essay

Audit Ch1

...AUDIT 401-01 Chapter 1: Auditing and Assurance Services User Demand for Reliable Information A. Information and Information Risk * ****Business risk: the risk that an entity will fail to meet its objectives**** * Environmental conditions to increase user demand for relevant, reliable, information: 1. Complexity 2. Remoteness 3. Time sensitivity 4. Consequences * Information risk: the probability that the information circulated by a company will be false or misleading * ****Assurance: Depend on information professionals to serve as an independent and objective intermediaries who will lend credibility to the information**** * ****Attestations: when the assurance is provided for specific assertions made by management**** Auditing, Attestation, and Assurance Services A. Definition of Financial Statement Auditing * ****Auditing: systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between the assertions and established criteria and communicating the results to interested users **** OVERVIEW: Independent auditor – obtains and evaluates evidence knowledge of client’s business, observation of physical assets, inquiry of managers, confirmations from third parties, inspection of documents Management assertions about economic actions and events: * Balance sheet * Income statement *......

Words: 731 - Pages: 3

Premium Essay

Business Tax

...The possible implication of that tax system for the Malaysian economy, If implemented. The Malaysian government has to make procedure decisions on how to implement the GST. The most necessary decision about VAT is if it should be imposed as a expenditure, gross-product or income-type tax. Malaysia proposed a consumption-based GST. The use of invoices for GST provides more simplicity on how the tax is imposed. For VAT imposed as an income-type the accounting representation would be more suitable. In that case it would be based on the economic records of the company. The main advantage of a VAT is that it is a broad based system. Typically government and non-profit enterprises are excluded from the tax base. Further an important policy decision is to determine the place where GST is levy. For International Trade the place where the GST is levied is a vital matter. On the one hand the GST can be levied on the location of assembly (the origin principle) on the other it can be based on the location of the final consumption (the destination principle).The origin principle VAT is levied on value added within the state for all goods and services despite of whether they are sold within the state or export out of the state. It excludes value added personified in the goods and services that originate outside the state. The most regular is the use of the goal principle. Our analysis thus far has focused on evaluate if GST is a regressive or progressive tax and the corrective actions,......

Words: 1607 - Pages: 7

Premium Essay

Tax Business

... Table of Contents Executive Summary 4-5 Product 6-7 a. Product Description 6 b. Physical Description 7 Value Proposition 9-10 c. For HomeGoods 9 d. For Customers 9 e. For Mobile HomeGoods 10 Market Analysis Summary 11-15 f. Target Market 11 g. Competition 13 h. Competitive Edge 14 i. S.W.O.T Analysis 14 Financial Plan 16-25 j. Pro Forma Cash Budget 16 k. Income Statement 18 l. Calculations 19 (1) Breakeven Point 19 (2) Sales Revenue 19 (3) Cost Of Goods Sold 21 (4) Expenses 23 (5) Operating Margin 25 Operations 26-30 m. Overview Of Logistics 26 n. Location Of Business 26 o. Schedule 26 p. Suppliers And Supply 27 q. Logistics 28 Sales Plan 31-33 r. Marketing 31 i. Message 31 s. Pricing And Sales Objectives 33 Human Resources 34-35 t. Past Work Experience 34 u. Skills And Abilities 34 v. Maintaining And Engaging Employees 34 w. Key Management People 35 x. Staffing Plan 35 Appendices 34-44 y. Resumes 36 (1) Feliciana Liem 36 (2) Alexander Lorenzo 37 (3) Juliane Martin 38 (4) Emma Munley 39 (5) Alexandria Murphy 40 z. Bibliography 41 I. Executive......

Words: 9126 - Pages: 37

Premium Essay

Ch1 of Finance

...Master of International Business Full Time Financial Management Lecturer: Mayra Mas Session 1 Financial Management Statements Basic Financial Statements Basic Financial Session 1 2 Relationship between Finance, Economics and Accounting • Economics provides a broad picture of the economic environment for decision making in many important areas. Accounting, the language of finance, provides financial data through:  Income • statements sheets  Balance  Statement of cash flows • Finance links economic theory with the numbers of accounting Types of Accounting 1. Financial Accounting • Provides information primarily to people outside the company ◦ Provides information that would be helpful in attracting capital     Equity and debt (useful in debt contracts) Credit from suppliers Customers Employees ◦ Provides information helpful in monitoring and evaluating management performance 4 Types of Accounting 2. Managerial Accounting ◦ Provides information to people inside the company  Internal investment decisions  Performance evaluation 3. Tax Accounting • Provides information to the tax authorities • Firms will (generally) maintain separate books for tax and financial purposes Basic Financial Statements • • Income Statement Statement of Retained Earnings (a short supplement to the income statement) Balance Sheet Statement of Cash Flows • • Introduction to Financial......

Words: 1105 - Pages: 5

Premium Essay

Business Tax, Ali Case Study

...SUBJECT: Business Tax, Outcome 1, Ali Case study. Income Tax Legislation. Income tax legislation can be found in the Income Tax (Earnings and Pensions) Act 2003, the Income Tax (Trading and Other Income) Act 2005 and the Income Tax Act 2007. Taxable supplies. A good understanding of the principles of VAT is very important in advising business. The third largest source of government revenues is value added tax (VAT), charged at 20% on supplies of goods and services. It is therefore a tax on consumer expenditure. Certain goods and services are exempt from VAT, and others are subject to VAT at a lower rate of 5% (the reduced rate, such as domestic gas supplies) or 0% ("zero-rated", such as most food and children's clothing). Exemptions are intended to relieve the tax burden on essentials while placing the full tax on luxuries, but disputes based on fine distinctions arise, such as the notorious "Jaffa Cake Case" which hinged on whether Jaffa Cakes were classed as (zero-rated) cakes—as was eventually decided—or (fully taxed) chocolate-covered biscuits. Five things to remember about exempt supplies: • You don’t include VAT in the price of exempt goods or services; • You are not eligible to claim input tax credits in acquiring exempt supplies; • You don’t include the value of the exempt supplies in your taxable turnover when establishing your VAT registration threshold; • If you only supply exempt goods or services, you cannot register for VAT......

Words: 2744 - Pages: 11

Premium Essay


...working are because it isn’t based on when the clinic is the busiest during the day. Also that Dr. Barr doesn’t have a full understand of how her business operates. 3. Identify some of the reasons why the clinic is having inventory problem. c. The clinic is having inventory problems is because the clinic needs to have better technology. With that newer technology Dr. Barr could avoid unexpected situations and know what the clinic has in the inventory. 4. What should Dr. Barr have done differently to avoid some of the problems she is currently experiencing? d. Dr. Barr should set up a system for the inventory to make sure inventory isn’t low or too high. She should also change the schedule around to make sure she has enough staff working during the busiest time of day. Also if Dr. Yen can’t work every Saturday with Dr. Barr then she should fire someone who can help her on Saturdays. The last thing Dr. Barr could do to avoid some problems is to give people different tasks to do when the clinic isn’t busy. 5. What suggestions would you make to Dr. Barr now? e. I would make some suggestions to Dr. Barr, which she needs to find an inventory management system that will work for her and her clinic. She could also reach out to a consultant, probably an outside of the clinic, who could help her with all of her business problems. The last suggestion I would make is to talk with nurses and office assistants about the problems the clinic is having so......

Words: 1020 - Pages: 5

Premium Essay

Federal Income Tax - Business

...Tax deductions are related to the legislative grace and the ability-to-pay concept. 2 Restrictions: 1. Only deductions allowed by the tax law may be subtracted to compute taxable income. Congress allows deductions for the costs of earning income and certain expenditures. 2. A deduction is allowed for an item only if all requirements are satisfied. Business Expense: the expense must have a business purpose that is unrelated to its tax effect. Gross Income: Only the excess of an individual’s capital investement. The deduction for an item may not exceed the cost. Basis: The cost of an asset or an expense. Represents the max amt of an expenditure that can be deducted as a recovery of capital. Trade or business expenses are deducted FOR adjusted gross income (always) Production-of-income expenses are deducted FROM adjusted gross income-Does not apply to Corportations (deduction is reduced by 2% agi. If agi is 40,000 (6%=$800) and exp is $6000, amt of deduction is $5200) Conduit Entity: Investment expenses of individuals & miscellaneous itemized deductions must be reduced by 2% of agi. Most common deductions that must be reported separately -Charitable contributions - Investment interest expense -Investment expense -Section 179 expense -Nondeductible expenses TRADE OR BUSINESS EXPENSES • Sec 162, “ all the ordinary and necessary expenses…including salaries & compensation, traveling expenses (including meals & lodging), and rentals or other payments......

Words: 1410 - Pages: 6

Premium Essay

Business Tax

...the primary obligation of the state to protect all the constituents regardless of whether they pay or not their tax liabilities. True or False 1-2 1. True 2. True 3. True 4. True 5. True 6. False. The President cannot delegate the power of taxation, since taxation is not vested in the President. Taxation is vested in the legislative body. 7. False. Taxation cannot be separated from the state. The moment a state exists, taxation also exists. 8. False. The making of tax law is undertaken ahead of the collection of taxes. 9. False. Levying refers to the making of tax laws. 10. False. Only the legislative body, the Congress, can grant tax exemptions. True or False 1-3 1. False. It is the legislative branch of the government that is vested with the power of taxation. 2. False. The power of taxation is restricted by inherent and constitutional limitations. 3. False. Tax assessment is the valuation and determination of the amount of tax. The passage of taxation is called levying or imposition of tax. 4. False. The three inherent powers can be and have been delegated by the Legislative to the Executive Branch. 5. True 6. True 7. False. The two kinds of double taxation are called indirect double taxation and direct double taxation. 8. False. Tax avoidance is a legal way of avoiding payment of taxes. 9. False. Income tax cannot be classified as ad valorem, since the amount is not fixed and does not rely upon an independent......

Words: 18322 - Pages: 74

Premium Essay

The Top 4 Tax Strategies to Save Your Business Money

...Tax season can be daunting for everyone, but small businesses and entrepreneurs need to pay particular attention to the benefits and deductions available to them in order to reduce their tax liability. There are many different types of business structures and strategies for how a successful business should be run, but one thing is certain -- across the board -- everyone is looking for ways to save money! Here are four tax strategies that can help any small business or entrepreneur save money: 1. Use your startup costs as a deduction. Starting a new business can be really exciting, but it can also be time consuming and expensive. Fortunately, the IRS provides a tax break by allowing you to deduct up to $5,000 of your initial startup costs in your first year of business. This deduction allows you to reduce your taxable income, both for income tax and self-employment tax, which includes Social Security, and Medicare tax. Typical startup costs include things like purchasing equipment, supplies, and operational fees, but the rest of your startup costs should be depreciated over 15 years. 2. Use the special depreciation rules to take larger deductions. When you purchase large items for your business -- items you expect to use for more than a year -- you generally cannot deduct the entire cost in that year. Instead you must depreciate the items and take a portion of the cost on your tax return each year. To get around this and deduct a larger amount in the year of......

Words: 632 - Pages: 3

Premium Essay

Ch1 Intermediate Accounting

...PART I A. Multiple choice. 50 points. 1. The information provided by financial reporting pertains to a. individual business enterprises, rather than to industries or an economy as a whole or to members of society as consumers. b. business industries, rather than to individual enterprises or an economy as a whole or to members of society as consumers. c. individual business enterprises, industries, and an economy as a whole, rather than to members of society as consumers. d. an economy as a whole and to members of society as consumers, rather than to individual enterprises or industries. 2. Decision makers vary widely in the types of decisions they make, the methods of decision making they employ, the information they already possess or can obtain from other sources, and their ability to process information. Consequently, for information to be useful there must be a linkage between these users and the decisions they make. This link is a. relevance. b. reliability. c. understandability. d. materiality. 3. Application of the full disclosure principle a. is theoretically desirable but not practical because the costs of complete disclosure exceed the benefits. b. is violated when important financial information is buried in the notes to the financial statements. c. is demonstrated by the use of supplementary information presenting the effects of changing prices. ...

Words: 3652 - Pages: 15