Chapter 16 Quiz - 1 An alternative tax calculation may be...

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1 An alternative tax calculation may be used when taxable income includes net long-term capital gain. Therefore, capital gains and losses must be matched with one another to see if a net long-term capital gain exists. Choose one answer. a. True Correct Question 2 Both short-term and long-term holding periods, respectively, are: Choose one answer. d. Twelve months or less and more than twelve months. Correct Question 1 Supplies of a type regularly used or consumed in the ordinary course of a business are a capital asset. Choose one answer. b. False Correct Correct. Question 2 Section 1237 allows real estate investors capital gain treatment if they engage only in limited development activities. Choose one answer. a. True Correct Correct. Question 3 An individual taxpayer owns a landscape painting. The painting would not be a capital asset if it was held by the taxpayer in which of the following circumstances? Choose one answer. e. a. and d. Correct Question 4 James is a dealer in securities. He would like to acquire and hold stock as a capital asset, then sell it to get a capital gain or loss. Which of the statements below is correct? Choose one answer. e. c. and d. Question 1 Business fixed assets are generally not capital assets. Choose one answer. a. True Correct Correct.
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Question 2 A music company is in the business of buying and then reselling song copyrights. The song copyrights are probably inventory for the company and, thus, not capital assets. Choose one answer. a. True Correct Correct. Question 3 Rea is a songwriter. She wrote a song, copyrighted it, and sold it for $10,000 cash. The song had a zero tax basis. The purchaser was a national song brokerage company. Rea is in the business of songwriting. Unless Rea makes a special election, the $10,000 received by Rea is: Choose one answer. c. Ordinary gain. Correct Question 4 Sam operates a variety store as a sole proprietorship. Which of the following items are capital assets in the hands of Sam?
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This note was uploaded on 04/03/2011 for the course ACC 3400 taught by Professor Balden during the Spring '11 term at Utah Valley University.

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Chapter 16 Quiz - 1 An alternative tax calculation may be...

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