On March 5, 2022, the two 50% shareholders of a calendar year corporation decide to elect S status. Shareholder Mila purchased her stock from a previous shareholder (a nonresident alien) on January 18, 2022. Identify any potential problems for Mila and the corporation.

Q: Sales Raw materials inventory, beginning Work in process inventory, beginning Finished goods…

A: The cost of goods sold includes the total cost of goods that are sold during the period. The cost of…

Q: Jerry sold an activity with a cost basis of $50,000 and suspended passive activity losses of $10,000…

A: “Since you have posted multiple questions, we will provide the solution only to the first question…

Q: Honore’s earned net income $337,000 last year. It has an estimated 70,000 shares of stock…

A: The monetary worth of an organization's earnings per outstanding share of common stock is known as…

Q: Alfredo Company purchased a new 3-D printer for $872,000. Although this printer is expected to last…

A: Depreciation is a non-cash expense that represents the gradual loss in value of a fixed asset. In…

Q: Wildhorse Services, Inc. is trying to establish the standard labor cost of a typical brake repair.…

A: Standard direct labor hours per brake repairs is  standard direct labor time require to complete one…

Q: BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it…

A: Net present value (NPV) is the difference between the present value of cash inflows and the present…

Q: Compare Martinez and Royo By converting Martinez 10,900 $ 6,660 3,564 Martinez Amount Net sales Cost…

A: Lets understand the basics. There are two type of analysis are made which are, (1) Verticle analysis…

Q: Required: 1. Prepare the journal entries to record the sale on November 17 (ignore cost of goods)…

A: Journal entry is the first stage of accounting process. Journal entry used to record business…

Q: Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products…

A: Contribution margin is the difference between the sales and the variable cost. So while preparing…

Q: 11. Highjinks, Incorporated, has provided the following budgeted data: Sales 20,000 units Selling…

A: The contribution Margin is calculated as difference between sales and variable cost. The net income…

Q: As loan analyst for Sage Bank, you have been presented the following information. Assets Cash…

A: Current ratio : Current Ratio is a measures of liquidity ratio which measures a firm has sufficient…

Q: Your friend Harold is trying to decide whether to buy or lease his next vehicle. He has gathered…

A: Net present value method :- It is defined as the difference between the present value of cash…

Q: On January 1, 2024, Baddour, Incorporated, issued 10%, 12-year bonds with a face amount of $162…

A: Bonds are bearer financial instruments with fixed interest that businesses issue to raise capital.…

Q: Which of the following choices reflects the correct order of stages in the budget cycle?   Agency…

A: The budget cycle refers to the series of stages and processes involved in the development, approval,…

Q: 1. Aladdin's Gyrocery has two product segments: falafel and gyros. Data for each product segment is…

A: Decision to drop the segment will depend on whether the regular operating income will increase or…

Q: Current Attempt in Progress Presented below are Crane Company's monthly manufacturing cost data…

A: Direct Material :— It is the cost of materials that are directly used in manufacturing of product…

Q: At January 1, 2025, Swifty Company reported retained earnings of $2,226,000. In 2025, Swifty…

A: Retained earnings are the part of earnings that remained undistributed among the shareholders of the…

Q: (b) How much did the client capitalize into inventory on a per-unit basis? Inventory cost per unit $

A: Answer:- Standard costing method:- The cost of products sold is used to correct the differences in…

Q: Rotorua Products, Limited, of New Zealand markets agricultural products for the burgeoning Asian…

A: Lets understand the basics. Trend analysis is an analysis done by the companies to understand their…

Q: Current Attempt in Progress Iggy Company is considering three capital expenditure projects. Relevant…

A: We will have to calculate the IRR for each project in the given case. IRR is the minimum acceptable…

Q: The ending materials inventory cost is:

A: Solution The material is the cost of materials used to manufacture a product. It is a part of…

Q: The cost of purchasing 400 kgs of direct materials and processing it up to the split-off point to…

A: Cost allocation is the process of distribution of the cost heads to various departments based on a…

Q: Given the data in the following table, the entry for Inventories on the 2023 common-sized balance…

A: Common Size Statement - If we have to evaluate the vertical analysis of the financial position then…

Q: Current Attempt in Progress Given below is an excerpt from a management performance report: 4 Budget…

A: Lets understand the basics. Management prepare budget in order to estimate future profit and loss.…

Q: Connection with the sale of these bonds, Socrates paid the following expenses: Promotion costs…

A: Issuing bonds is one way for companies to raise money. Bonds are issued as forms of tradable debt.…

Q: Cyrus Bautista owns and operates Aquarius Advertising Services. On January 1, 20Y3, Cyrus Bautista,…

A: Statement of owner’s equity: It is the statement that shows the changes in owner’s equity during the…

Q: Years ago, the company purchased a software package that was used by other companies  in the same…

A: The measures a company takes to protect its assets, assure the accuracy and dependability of its…

Q: Gunst Company produces three video games: Android, Bio-Mutant, and Cyclops. Cost and revenue data…

A: Given, Direct labor rate = $12 per hour  Direct labour hours = 1,000 hours

Q: TaylorMade Golf is preparing its cash budget for Q1 2024. Cash sales are collected in the month of…

A: A cash budget is one of the important budgets that shows the total collection made and total…

Q: how activity based costing has been discovered?

A: Activity-based costing, often known as ABC, is a way of allocating overhead and indirect expenses to…

Q: The following information is provided for Worldwide Travel Service which is owned by Albert Mitchell…

A: JOURNAL ENTRIES Journal Entry is the First stage of Accounting Process. Journal Entry is the Process…

Q: 790 800 77 65 53 42 32 24 16 69 0

A: Net pay means take-home pay or the amount employees earn after all payroll deductions are subtracted…

Q: Packers Company factored $200,000 in accounts receivable with Vikings Finance on a with recourse…

A: Accounts receivables means the amount of money which is yet to be collected from the customers. It…

Q: Horizontal and Vertical Analysis Plato Clothing Company specializes in selling apparel for special…

A: Horizontal and vertical analysis are two common methods used in financial statement analysis to…

Q: Radical Boards, Inc. manufactures and sells a single model of snowboard, the Vortex. In the summer…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Journalize the above transactions, including the adjusting entry for the accrual of interest on…

A: Journal entry is the first stage of accounting process. Journal entry used to record business…

Q: Land Buildings Accumulated depreciation-buildings Machinery Accumulated depreciation-machinery 2023…

A: CFS stands for Cash flow statement which states the inflow or coming as well as outflow or outgoing…

Q: 40 00:59:33 Questions 39-40 refer to the following: The Minard company uses the following condensed…

A: Manufacturing overhead is the total costs incurred outside of the costs related to direct labor and…

Q: Serenity Systems Co. offers its services to residents in the Minneapolis area. Selected accounts…

A: The statement of owners' equity is prepared to record the changes in the capital balance of owners.…

Q: Approach to Activity-based costing

A: Activity-based costing (ABC) is a method of cost accounting that assigns indirect costs to products…

Q: Waterway Engine Incorporated produces engines for the watercraft industry. An outside manufacturer…

A: Relevant cost can be defined as that cost which does not remain same under the two alternatives.…

Q: Required information Use the following information for the Exercises below. (Algo) [The following…

A: Under marginal Costing Income is Computed by Deducting Fixed cost from Contribution Margin.…

Q: You deposit $2000 in an account earning 3% interest compounded monthly. How much will you have in…

A: If the interest rate is compounded monthly, then amount can be calculated as below. Amount =…

Q: EX 6-13 Determining amounts to be paid on invoices OBJ. 2 Determine the amount to be paid in full…

A: a Merchandise        20,500   Less: Return and Allowances         -4,800   Amount to be paid in…

Q: Kingbird Holding's accounting records show the following balances on December 31, 2020. 12%…

A: Cumulative preference shares are those shares that are paid a dividend every year. If any dividend…

Q: Carlberg Company has two manufacturing departments, Assembly and Painting. The Assembly department…

A: Equivalent units of production = Units completed and transferred out + Units in ending WIP *…

Q: Statement of Owner's Equity; Net Loss Selected accounts from the ledger of Masterpiece Arts for the…

A: Answer:-  Statement of owner's equity:- In a report called a "statement of owner's equity," the…

Q: implementation of activity based costing?

A: Introduction:- Activity-Based Costing (ABC) can be a powerful tool for improving cost management and…

Q: At January 1, 2021, Canaday Corporation had outstanding the following securities: 610 million common…

A: Common shareholders have had the smallest claim on the assets of a firm of any sort of shareholder.…

Q: a = Fixed production costs per month = Variable production costs per direct labor hour = Number of…

A: High-low method is one of the techniques that is used to separate fixed and variable components…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.