ACCOUNTING F/GOV.+..(LL)-W/CODE>CUSTOM<
18th Edition
ISBN: 9781264107919
Author: RECK
Publisher: MCG CUSTOM
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Question
Chapter 13, Problem 7Q
To determine
Explain the means to ensure a gift shop run by a not for profit museum is not subjected to unrelated business income tax liability.
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Pel Museum is a private not-for-profit entity. If it receives a contribution of historical artifacts, it need not recognize the contribution if the artifacts are to be sold and it will use the proceeds to
Support general museum activities.
Acquire other items for collections.
Repair existing collections.
Purchase buildings to house collections.
Pel Museum is a private not-for-profit entity. If it receives a contribution of historical artifacts, it need not recognize the contribution if the artifacts are to be sold and it will use the proceeds to:a. Support general museum activities.b. Acquire other items for collections.c. Repair existing collections.d. Purchase buildings to house collections
Identify which statement is incorrect: *
a. Sale of goods or services by any person or entity may result to the payment of income tax.
b. Sale of goods or services by any person or entity may result to the payment of business tax.
c. Sale of goods or services by any person or entity may result to the payment of donor's tax.
d. All statements are correct.
e. All statements are incorrect.
Chapter 13 Solutions
ACCOUNTING F/GOV.+..(LL)-W/CODE>CUSTOM<
Ch. 13 - Prob. 1QCh. 13 - Prob. 2QCh. 13 - Prob. 3QCh. 13 - Prob. 4QCh. 13 - Prob. 5QCh. 13 - Prob. 6QCh. 13 - Prob. 7QCh. 13 - Prob. 8QCh. 13 - Prob. 9QCh. 13 - Prob. 10Q
Ch. 13 - Jan and Dean decided to form a charitable...Ch. 13 - Prob. 17.2EPCh. 13 - Prob. 17.3EPCh. 13 - Prob. 17.4EPCh. 13 - Prob. 17.5EPCh. 13 - Prob. 17.6EPCh. 13 - Prob. 17.7EPCh. 13 - Prob. 17.8EPCh. 13 - Prob. 17.9EPCh. 13 - When a tax-exempt organization dissolves, the...Ch. 13 - Prob. 18EPCh. 13 - Use Illustration 13-4 as a guide in completing...Ch. 13 - Prob. 20EPCh. 13 - Prob. 21EPCh. 13 - Prob. 22EP
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- Identify which statement is incorrect: Sale of goods or services by any person or entity may result to the payment of income tax. Sale of goods or services by any person or entity may result to the payment of business tax. Sale of goods or services by any person or entity may result to the payment of donor's tax. All statements are correct. All statements are incorrect.arrow_forwardHow is a business activity distinguished from an investment activity? why is this distinction important for the purpose of calculating federal income taxes? What types of losses may potentially be characterized as passive losses?arrow_forwardWhich of the following statements are TRUE?(i) Interest expense incurred on loan to purchase motor cars for salesmen’s use is deductible as the salesmen use the cars only for meetings with customers and suppliers.(ii) Expenses which qualify for special deduction under Section 14Q relates to capital expenditure which do not qualify for capital allowances claim.(iii) Donation of computers to institutions of public character by an individual is not deductible.arrow_forward
- In an agreement involving the right to acquire property, which of the following are conditions that must be met in order for the IRS to accept the purchase price set in the agreement as a valid measurement of the value of the property being acquired? The purchase price must be determined by an independent appraisal submitted with an informational gift tax return regardless of the value of the property. The agreement must be a bona fide business arrangement. The agreement cannot be an attempt to transfer the property to a family member for less than full and adequate consideration. The terms of the agreement must be comparable to those that would be entered into by persons in an arm's-length transaction A) I and III B) II and IV C) I and IV D) II, III, and IVarrow_forwardWhich of the following criteria would suggest that a not-for-profit capitalize its works of art, historical treasures, or similar assets?a. They are held for public inspection, education, or research in furtherance of public service rather than financial gain.b. They are protected, kept unencumbered, cared for, and preserved.c. They are subject to be used in the acquisition of other items for the collection.d. They are held primarily to be resold for financial gain.arrow_forward14) When examining revenue transactions, which of the following transactions is classified as an exchange transaction? A) When a homeowner pays property taxes B) When a university receives a federal grant that mandates a certain type of research activity C) When an aquatic center receives cash for a group swim D) When an employer deducts money for state tax withholdingarrow_forward
- -Which of the following should not be claimed as deductions from gross income? * interest payment on loans for the purchase of machinery and equipment used inbusiness. salaries and bonuses paid to employees. discounts given to senior citizens on certain goods and services. advertising expense to maintain some form of goodwill for the taxpayer’s business.arrow_forwardWhich of the following statements is correct? When depreciable property is gifted to another individual taxpayer, the depreciation recapture potential is extinguished. When depreciable property is inherited by a taxpayer, the depreciation recapture potential is extinguished. When corporate depreciable property is distributed as a dividend, the depreciation recapture potential is generally not recognized. When depreciable property is contributed to charity, the depreciation recapture potential has no effect on the amount of the charitable contribution deduction. All of the above are correct.arrow_forwardWhat is the implication of a tax invoice not being received for the light fittingsarrow_forward
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