1. Assuming the taxpayer is a CORPORATION, how much is the OSD and net taxable income using OSD? Data of an individual taxpayer for the current taxable period:Gross salesP3,200,000Cost of sales1,900,000Sales discounts granted (for timely payments)Discounts granted to senior citizens and PWDSIncidental income (operating)Other income (non-operating)Operating expenses100,00080,000200,000150,000400,000

Tax Tax refers to the compulsory payment made by individuals or corporations to the government.…

Answered: Assuming the taxpayer is a CORPORATION,…

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter16: Multijurisdictional Taxation

Section: Chapter Questions

Problem 1BCRQ

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How do the all events and economic performance requirements apply to the following transactions by an accrual basis taxpayer? a. The company guarantees its products for six months. At the end of 2019, customers had made valid claims for 600,000 that were not paid until 2020. Also, the company estimates that another 400,000 in claims from 2019 sales will be filed and paid in 2020. b. The accrual basis taxpayer reported 200,000 in corporate taxable income for 2019. The state income tax rate was 6%. The corporation paid 7,000 in estimated state income taxes in 2019 and paid 2,000 on 2018 state income taxes when it filed its 2018 state income tax return in March 2019. The company filed its 2019 state income tax return in March 2020 and paid the remaining 5,000 of its 2019 state income tax liability. c. An employee was involved in an accident while making a sales call. The company paid the injured victim 15,000 in 2019 and agreed to pay the victim 15,000 a year for the next nine years.
LO.2 Osprey Corporation, an accrual basis taxpayer, had taxable income for 2019 and paid 40,000 on its estimated state income tax for the year. During 2019, the company received a 4,000 refund upon filing its 2018 state income tax return. The company filed its 2019 state income tax return in August 2020 and paid the 7,000 state income tax due for 2019. In December 2019, the company received a notice from the state tax commission that an additional 6,000 of income tax was due for 2017 because of an error on the return. The company acknowledged the error in December 2019 and paid the additional 6,000 in tax in February 2020. What is Ospreys 2019 Federal income tax deduction for state income taxes?
Carol reports taxable income of 48,000. Included in that calculation are the following items. Carol also had excluded municipal bond interest income of 8,000, 3,000 of which was deemed to be private activity bond interest. What are Carols total alternative minimum tax (AMT) adjustments? a. 1,200 b. 2,000 c. 3,000 d. 6,750

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