Explain the difference between the specific interest method and the weighted-average method in determining the amount of interest to be capitalized.

Q: How are the Capital al losses deducted from capital gains?

A: When an asset such as property for investment purpose (not for personal use), cars and investment…

Q: What are the quantitative disclosures that must be done by lessee?

A:

Q: What are the different kinds of payments that are taxable or non taxable under the FU

A: Payments that are non taxable / exempt under the FUTA are as follows dismissal payments wages…

Q: What are arguments for and against preferential treatment of capital gains?

A: Capital gain defined as the increase in the value of the capital asset and it is realized when the…

Q: Describe the procedures for determining after-tax net cash flows in taxable situations?

A: Net cash flow after tax is an important measure used for the purpose of evaluation of company's…

Q: How much gain or loss will Bill recognize on the distribution? What is Bill's basis in the inventory…

A: The calculation of gain or loss on distribution and basis in inventory and capital asset is shown…

Q: how do compute thesocial security taxable earnings?

A: Federal income taxes (FIT) are imposed in USA. Tax is calculated by applying tax rates which…

Q: You must explain in detail the difference between simple interest and compound interest

A: simple interest:- simple interest is calculated on the principal amount and it doesn't compound in…

Q: Explain how electing the fair value option and how impairment recognition affectaccounting for…

A: Definition: Impairment: It is a situation that arises when the carrying value of the investment…

Q: When using the fair value method, we adjust the reported amount of the investment for changes in…

A: The sales price agreed by the buyer and seller is termed as Fair value assuming both parties are…

Q: Is taxable interest income generated via active or passive investments, or through a portfolio of…

A: The Answer

Q: How can we determine ordinary gains and capital gains?

A: Answer: In the course of normal business, an ordinary gain is income. The gain or loss of foreign…

Q: Based on the range of possible SUTA tax rates and thresholds, which of the following circumstances…

A: The State Unemployment Tax Act (SUTA) tax:- It is a type of payroll tax that all employers must pay…

Q: ,calculate the amount of amortization of the net loss or gain that should be included

A: Defined Benefit Pension plan can be defined as the payment plan granted by the employer to the…

Q: Demonstrate the computation and allocation of consolidated net income in the presence of a…

A: Non Controlling interest or Minority Interest is the ownership interests in the subsidiary that are…

Q: Explain Transfer of Property or a Beneficial Interest in Borrower?

A: The question is based on the agreement of Mortgage loan in real estate deal.

Q: Explain the method of direct capitalization method?

A: The three approaches to value a business or an investment are the Income based,  Market based and…

Q: What items are excluded from the statutory definition of Capital Asset? Why?

A: Capital assets are assets which may or may not connect with the business and include all tangible or…

Q: should be capitalized as intangıble assets. O True O False

A: An intangible assets is An identifiable, non monetary, without physical substance, held for use…

Q: What is the amount of itemized deductions that can be claimed on the state return?

A: Itemized deduction is the amount of deduction that is subtracted from the gross income and it…

Q: What is the difference between simple and compound interest? Give examples.

A: Simple interest: It is the interest calculated on the principal of the loan and the account holder…

Q: What is the indicated value of the subject property using direct capitalization, rounded to the…

A: Direct Capitalization Method: This method computes the value by dividing the net operating income…

Q: Describe the Replacement Analysis with Tax Considerations?

A: Introduction: Capital budgeting is one of the important techniques used to determine the value that…

Q: What is meant by issue of debentures as “Purchase Consideration”.

A: Debenture is a long term or medium term debt instrument issued to borrow loan.

Q: The amount to be capitalized should be:

A: Answer:   Option a.

Q: how is it possible that the avoidable interest can exceed the actual interest

A: Interest Cost: The cost charged on the borrowings financed by the lender to the company is known as…

Q: The capitalization rate used to determine the capitalizable borrowing cost should be disclosed.…

A: It is pertinent to note that as per IAS 23 borrowing costs incurred for acquisition, construction of…

Q: Explain how differing assumptions about capitalization rate , reversion value, and highest and best…

A: Property is referred as an item, where the business or person used to have the legal title over.…

Q: Describe the concepts and valuation principles underlying the acquisition method of accounting for…

A: Acquisition: The acquisition refers to the business combination when one entity or organization…

Q: What is a Capital Gain Tax (CGT) Asset? Give at least one example for each of the three types of…

A: Capital gain tax asset is an asset which when sold, the gain will attract capital gain tax.  As per…

Q: Provide examples of assets that do not qualify for interest capitalization.

A: Assets: Assets are those items that provide value for money and future economic benefit for an…

Q: What is the three-step process used to determine the amount of interest capitalized?

A:

Q: What factors should be consi

A: Debenture   A debenture is a type of debt instrument unsecured by collateral. Since debentures…

Q: hat is the difference between simple interest and compound interest?

A: The difference between simple interest and compound interest is as follows-

Q: Explain the nature of interest on debentures.

A: A fixed amount of money which is paid in the form of interest to the holders of the debentures at…

Q: Which mathematial expression is used to calculate the after tax cost of debt?

A: Cost of debt: Cost of debt is the effective rate of interest that the firm pays on its present…

Q: how to compute in simplest form the non controlling interest using fair value method and…

A: Non-Controlling Interest Non-controlling interest or minority interest situation occurs when an…

Q: Determine the amount of recognized gain or loss. Explain whether the gain or loss is capital or…

A: Recognized Gain/loss on asset  = 325,000+196,000-605,000-27,000+315,000 = 204,000

Q: What methods can be used to find the before-tax cost of debt? How is the before-tax cost of debt…

A: Debt is always considered after tax, because interest on debt is a tax deductible expense.

Q: Define each of the following terms:a. Interest tax shields; value of tax shield

A: tax shield is deduction ability to shield portions of the taxpayers income from taxation.