ACCT_335_Exam_3 - Mountain State University ACCT 335...

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Mountain State University ACCT 335 Federal & State Taxation I Exam 3 Name: _____________________________________________ ID: ________________ Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Corey performs services for Sophie. Which, if any, of the following factors indicate that Corey is an independent contractor, rather than an employee? a. Sophie sets the work schedule. b. Sophie provides the tools used. c. Corey files a Form 2106 with his Form 1040. d. Corey is paid based on the tasks performed. e. None of the above. ____ 2. A worker may prefer to be classified as an employee (rather than an independent contractor) for which of the following reasons: a. To avoid the self-employment tax. b. To claim unreimbursed work-related expenses as a deduction for AGI. c. To avoid the cutback adjustment on unreimbursed business entertainment expenses. d. To avoid the 2%-of-AGI floor on unreimbursed work-related expenses. e. None of the above. ____ 3. Statutory employees: a. Report their expenses on Form 2106. b. Include common law employees. c. Are subject to income tax withholdings. d. Claim their expenses as deductions for AGI. e. None of the above. ____ 4. Aaron is a self-employed practical nurse who works out of his home. He provides nursing care for disabled persons living in their residences. During the day he drives his car as follows. Aaron’s home to patient Louise Miles 12 Patient Louise to patient Carl 4 Patient Carl to patient Betty 6 Patient Betty to Aaron’s home 10 Aaron’s deductible mileage for each workday is: a. 32 miles. b. 22 miles. c. 20 miles. d. 12 miles. e. 10 miles.
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____ 5. When using the automatic mileage method, which, if any, of the following expenses also can be claimed? a. Engine tune-up. b. Auto insurance. c. Toll charges. d. MACRS depreciation. e. None of the above. ____ 6. Bill is the regional manager for a national chain of auto-parts stores and is based in Salt Lake City. When the company opens new stores in Boise, Bill is given the task of supervising their initial operation. For three months, he works weekdays in Boise and returns home on weekends. He spends $410 returning to Salt Lake City but would have spent $390 had he stayed in Boise for the weekend. As to the weekend trips, how much, if any, qualifies as a deduction? a. $0, since the trips are personal and not work related. b. $0, since Bill’s tax home has changed from Salt Lake City to Boise. c. $390. d. $410. e. None of the above. ____ 7. During the year, Walt went from Louisville to Hawaii on business. Preceding a five-day business meeting, he spent four days vacationing at the beach. Excluding the vacation costs, his expenses for the trip are: Air fare $3,200 Lodging 900 Meals 800 Entertainment 600 Presuming no reimbursement, deductible expenses are: a. $5,500. b. $4,800.
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This note was uploaded on 01/31/2012 for the course ACCOUNTING 335 taught by Professor Kathy during the Spring '11 term at NMSU.

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ACCT_335_Exam_3 - Mountain State University ACCT 335...

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