Research Case 16–6 Researching the way tax deductions are reported on a corporation tax return; retrieving a tax form from the Internet • LO16–1, LO16–2, LO16–3, LO16–8 The U.S. Treasury maintains an information site on the Internet. As part of this site, the Internal Revenue Service provides tax information and services. Among those services is a server for publications and forms which allows a visitor to download a variety of IRS forms and publications. Required: 1. Access the Treasury site on the Internet. The web address is www.ustreas.gov . After exploring the information available there, navigate to the IRS server for forms and publications via the IRS home page. 2. Download the corporation tax return, Form 1120. 3. Note the specific deductions listed that are deductible from total income to arrive at taxable income. Are any deductions listed that might not also be included among expenses in the income statement? 4. One of the deductions indicated is “net operating loss deduction.” Under what circumstances might a company report an amount for this item? 5. Based on how taxable income is determined, how might temporary differences be created between taxable income and pretax income in the income statement?
Research Case 16–6 Researching the way tax deductions are reported on a corporation tax return; retrieving a tax form from the Internet • LO16–1, LO16–2, LO16–3, LO16–8 The U.S. Treasury maintains an information site on the Internet. As part of this site, the Internal Revenue Service provides tax information and services. Among those services is a server for publications and forms which allows a visitor to download a variety of IRS forms and publications. Required: 1. Access the Treasury site on the Internet. The web address is www.ustreas.gov . After exploring the information available there, navigate to the IRS server for forms and publications via the IRS home page. 2. Download the corporation tax return, Form 1120. 3. Note the specific deductions listed that are deductible from total income to arrive at taxable income. Are any deductions listed that might not also be included among expenses in the income statement? 4. One of the deductions indicated is “net operating loss deduction.” Under what circumstances might a company report an amount for this item? 5. Based on how taxable income is determined, how might temporary differences be created between taxable income and pretax income in the income statement?
Solution Summary: The author explains the purpose of the case, which is to provide basic knowledge regarding tax return and its process.
Researching the way tax deductions are reported on a corporation tax return; retrieving a tax form from the Internet
• LO16–1, LO16–2, LO16–3, LO16–8
The U.S. Treasury maintains an information site on the Internet. As part of this site, the Internal Revenue Service provides tax information and services. Among those services is a server for publications and forms which allows a visitor to download a variety of IRS forms and publications.
Required:
1. Access the Treasury site on the Internet. The web address is www.ustreas.gov. After exploring the information available there, navigate to the IRS server for forms and publications via the IRS home page.
2. Download the corporation tax return, Form 1120.
3. Note the specific deductions listed that are deductible from total income to arrive at taxable income. Are any deductions listed that might not also be included among expenses in the income statement?
4. One of the deductions indicated is “net operating loss deduction.” Under what circumstances might a company report an amount for this item?
5. Based on how taxable income is determined, how might temporary differences be created between taxable income and pretax income in the income statement?
Section 12.2 Assessment
QUICK CHECK
Calculate Given the informa-
tion above, use Form 1040EZ in
Figure 12.4 on pages 394 and 395 and the
corresponding tax table in Figure 12.5 on
page 397 to determine whether Shirley will
owe the government money or will obtain
a refund. How much money will she owe,
1. Who must file a federal income tax return?
2. What are the three basic tax forms discussed
in this section?
3. What documents do you need to begin to
prepare your tax return?
THINK CRITICALLY
or how much will her refund be?
4. Briefly describe situations in which it
would be advantageous to use Form 1040A
instead of Form 1040EZ. When would you
use Form 1040EZ?
SOLVE MONEY PROBLEMS
6. Planning for Tax Time Poor Fred.
Tax time is drawing near, and he does not
know how to begin to prepare his income
tax return. He has piles of forms and other
paperwork, but he just cannot figure out
what to do with them. Fred needs help,
USE MATH SKILLS
5. A Taxing Question Last year, Shirley,
a single…
QUESTION 26
The U.S. tax code is based on the iden that everyone should help finance the government according to ability to pay.
O True
False
Question 18: Julio has $10 withheld from every paycheck to be used as a donation to a local charity. When his employer pays these withheld amounts to the
charity, what type of account is debited?
Answer:
A.
O Asset
В.
O Liability
C.
O Revenue
D.
O Expense
Principles Of Taxation For Business And Investment Planning 2020 Edition
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