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exam 2 answers0001 - Individual Tax Accounting Planning...

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Individual TaxAccounting & Planning - Fall2010 ~) ,?O Name: _ ••• ..... Exam#2 - chapters 6, 7, 9 &10 Section (circle one) 9:30 or 11:00 Please indicate your answers to the questions on the following pages in the table below. Answers noted on the question pages will not be considered. Chapter 6 Chapter 7 Chapter!! Chapter-lO ~'2... l.a. ~\000 l.b. \~O \\1.-S 3. l.c. 1000 4.a. 2. ~Q;'.'O ~L\.oo 4.b. ~~ n.-" ~~ ~'Oo 3.a. ~\<p '\ 00 I '- '\ 1.1 ~":t-o ...• , \\'"~ 3.b. ~ ~ 2.~16::bru 3.c. ""bt..!lD Z 0 \\ 0tN"-
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.dividual Tax Accounting & Planning - Fall 2010 Exam #2 - chapters 6, 7, 9 &10 Name: _ Section (circle one) 9:30 or 11:00 Chapter 6 1. Gladysowns a retail hardware store in Tangipahoa. Sheis considering opening a businessin Hammond, a community located 25 miles away. Sheincurs expensesof $60,000 in 2010 in investigating the feasibility and desirability of doing so. What amount can Gladysdeduct in 2OiOif the businessis: a. Another retail hardware store which she opens in December 2010? lA--O, 000 b. Another retail hardware store which she decides against opening? ~,OOO c. A video rental store which she opens in December 2010? d. A video rental store which she decides against opening? o Arnold and Beth file ajoint return. Usethe following data to calculate their deduction for AGI. 2. Mortgage interest on personal residence Property taxes on personal residence Alimony payments \ ~ .000 Moving expenses Charitable contributions State income taxes Investment interest ($8,000 of expenseslimited to net investment income of $6,000) Unreimbursed employee expenses Salestaxes 3. In preparing his 2010 Federal income tax return, Sam,who is not married, incorrectly claimed alimony payments of $12,000 9.? an itemized deduction (rather than asa deduction for AGI).Sam'sAGI is $&9,000 and itemized deductions (which consist of the alimony, property taxes, and mortgage interest) are $~. Which of the following statements is correct? a. The error will result in taxable income being overstated. b. The error will result in taxable income being understated. c. The error could result in either taxable income being overstated or understated. ®he error will have no effect on taxable income. e. None of the above. ' ole., -:0 ~O - =::::::::>' '2-..0,0<00 l \ 1...,000"> '<::.~ ~~~ ~. 10100 '7 <6"\00 (s 0 .OCO A(o \ ?-re.
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