Auchiel and Ben are working in patnership as accountants. Kuria gives auchiel ksh. 100,000 for investment in some good security. Auchiel hides this to co-partner (Ben) and misappropriates the money. Kuria files a suit on the firm for the recovery of his ksh. 100,000 in your opinion, will he succeed? Give reasons
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Auchiel and Ben are working in patnership as accountants. Kuria gives auchiel ksh. 100,000 for investment in some good security. Auchiel hides this to co-partner (Ben) and misappropriates the money. Kuria files a suit on the firm for the recovery of his ksh. 100,000 in your opinion, will he succeed? Give reasons.
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- Blaze operates a restaurant in Cleveland. He travels to Columbus to investigate acquiring a business. He incurs expenses as follows: 1,500 for travel, 2,000 for legal advice, and 3,500 for a market analysis. Based on the different tax consequences listed below, describe the circumstances that were involved in Blazes investigation of the business. a. Blaze deducts the 7,000 of expenses. b. Blaze cannot deduct any of the 7,000 of expenses. c. Blaze deducts 5,000 of the expenses and amortizes the 2,000 balance over a period of 180 months.First Metro Pacific was able to persuade Francis to join the company as its Assistant Vice President for Finance which included a car plan worth P3,000,000 in its compensation The company purchased the vehicle and registered the same in favor of Francis. Assuming further that Francis is a non-resident alien not engaged in trade or business, how much is the fringe benefits tax?Jack and Jill decided to pool their money and start a water delivery business. Since they trust each other so much, they did not draw up any legal documents for the business. During the first year of business, they earned $50,000 which was net of $10,000 paid to Jill as a guaranteed payment. During the second year of business, they decided to limit their liability exposure by forming an LLC. Was a partnership formed during the first year? If a partnership was formed, how much income will be taxed at the partnership level? For the second year, do they need to file a partnership tax return?
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- Scott requested Jenny to work with the Bureau of Internal Revenue (BIR) in further reducing the tax liability of thecompany believing her to be an accountant. Meanwhile, Jennytook advantage of Scott’s mistaken belief and trust and convinced him that he would reduce the company’s tax liability by 50% in exchange for a substantive number of shares in the company. Is Scott’s donation of a substantive number of the company’s shares to Jenny valid? Why or whynot?Peter Marwick, an accountant and accrual basis taxpayer, performed accounting services in Year One for Ellie Vader. Peter gave Ellie a bill for $30,000 in Year One. Ellie paid Peter $5,000 in Year One, but Ellie disputes that she owes the other $25,000 because she thinks his work is shoddy. Ellie agreed to put $25,000 in escrow until she and Peter could resolve their legal dispute over Peter's fees. In Year Three after litigation, the dispute is resolved in Peter's favor and he gets the money out of escrow. How much income does Peter have and when? Question 9 options: Peter has $30,000 income in Year 1 because he is on the accrual method. Peter has no income in Year 1 because there is a contested liability. Ellie has $25,000 in cancellation of indebtedness income in Year 1. Peter has $5,000 income in Year 1 and $25,000 in Year 3 under the Claim of Right Doctrine.D was tasked to buy all the coffee beans supplies for the partnership. The accountant of the partnership gave D P100,000.00. When D was about to pay the coffee beans, D found out that he was lacking P50,000.00. So that he will not be delayed in delivering the coffee beans, D gave an additional P50,000.00. What right can D avail to get back his P50,000.00? He has the remedy for accounting He has the remedy for return of the capital He has the remedy to file for reimbursement He has the remedy for information
- Jessica is a professional consultant. She agrees to consulting services for Joe for $2,000. After she finishes, Joe does not have cash to pay Jessica, but he has an antique, collectible baseball card with a fair market value of $2,000 that he gives her to satisfy the payment. The baseball card cost Joe $500. How much should Jessica include in her gross income?Mark and Marsha recently graduated from the Law School and want to start a general practice law firm together. Since they were friends for a long time and graduated at the top of their class, they are confident in each other’s ability to practice law. Each of them has about $20,000.00 to invest in the new law firm, and neither has any significant personal assets besides two secondhand cars from their law school days. They are unsure of how to form their business association, and they visit the consultancy company that you work for to learn about their options. Your supervisor advises you to recommend that they form a LLP, a LLC, or a professional corporation.Scrooge is thinking of selling his money lending business. He has been the sole owner for 6 years since his partner died. He has three employees – Bob, Cindy, and Dale. He decides to sell the company to the three of them. The business is worth $120,000. Each employee puts in $40,000 to buy the company. According to the Howey Test, was a security issued? A. Yes, because there was an equal investment of money B. No, because he did not register with the SEC C. Yes, because there was a common enterprise D. No, because there was a complete sale of the business