Regulation 3 PassMaster Questions - Becker CPA Review PassMaster Questions Lecture Regulation 3 CPA PassMaster QuestionsRegulation 3 Export Date 1 2009

Regulation 3 PassMaster Questions - Becker CPA Review...

This preview shows page 1 - 4 out of 95 pages.

Becker CPA Review, PassMaster Questions Lecture: Regulation 3 1 © 2009 DeVry/Becker Educational Development Corp. All rights reserved. CPA PassMaster Questions–Regulation 3 Export Date: 10/30/08
Image of page 1
Becker CPA Review, PassMaster Questions Lecture: Regulation 3 2 © 2009 DeVry/Becker Educational Development Corp. All rights reserved. C Corporations, Depreciation, and MACRS CPA-01659 Type1 M/C A-D Corr Ans: B PM#1 R 3-01 1. CPA-01659 ARE Nov 95 #3 Page 19 A C corporation's net capital losses are: a. Carried forward indefinitely until fully utilized. b. Carried back 3 years and forward 5 years. c. Deductible in full from the corporation's ordinary income. d. Deductible from the corporation's ordinary income only to the extent of $3,000.CPA-01659 Explanation Choice "b" is correct. A C corporation's net capital losses are carried back 3 years and forward 5 years; they expire after 5 years. In addition, a C corporation cannot deduct net capital losses from ordinary income. Choice "a" is incorrect. A C corporation's net capital losses cannot be carried forward indefinitely. They expire after 5 years. Choices "c" and "d" are incorrect. A C corporation cannot deduct net capital losses from ordinary income.CPA-01665 Type1 M/C A-D Corr Ans: D PM#2 R 3-01 2. CPA-01665 ARE Nov 95 #7 Page 19 Baker Corp., a calendar year C corporation, realized taxable income of $36,000 from its regular business operations for calendar year 1994. In addition, Baker had the following capital gains and losses during 1994: Short-term capital gain $8,500 Short-term capital loss (4,000) Long-term capital gain 1,500 Long-term capital loss (3,500) Baker did not realize any other capital gains or losses since it began operations. What is Baker's total taxable income for 1994? ) Westwind
Image of page 2