Aicpa fn measurement keywords blooms application

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Essentials of Business Law
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Chapter 25 / Exercise 06
Essentials of Business Law
Beatty
Expert Verified
AICPA: FN-MeasurementKEYWORDS: Bloom's: ApplicationOTHER: Time: 15 min.66. In 2015, Sarah (who files as single) had silverware worth $10,000 (basis $6,000) stolen from her home. Sarah’s insurance company told her that her policy did not cover the theft. Sarah’s other itemized deductions last year were $2,000. She had AGI of $30,000 last year. In August of 2016, Sarah’s insurance company decided that Sarah’s policy did cover the theft of the silverware and they paid Sarah $5,000. Determine the tax treatment of the $5,000 received by Sarah during 2016.a. None of the $5,000 should be included in gross income.b. $2,900 should be included in gross income.c. $5,000 should be included in gross income.
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Essentials of Business Law
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Chapter 25 / Exercise 06
Essentials of Business Law
Beatty
Expert Verified
Chapter 07 - Deductions and Losses: Certain Business Expenses and Lossesd. Last year’s return should be amended to include the $5,000.e. None of the above.ANSWER: RATIONALE: Sarah would have taken a casualty loss of $2,900 ($6,000 – $100 – $3,000) in 2015. Therefore, the total itemized deductions would be $4,900 ($2,900 + $2,000). Because this is less than the 2015 standard deduction of $6,300 for single taxpayers, Sarah would have takenthe standard deduction. Hence, none of the $5,000 would be included in gross income under the tax benefit rule.
a
POINTS: 1DIFFICULTY: ModerateLEARNING OBJECTIVES: CMPV.SWFT.LO: 7-04 - LO: 7-04NATIONAL STANDARDS: United States - BUSPORG: AnalyticSTATE STANDARDS: United States - AK - AICPA: FN-Measurement -AICPA: FN-MeasurementKEYWORDS: Bloom's: ApplicationOTHER: Time: 5 min.67. Alma is in the business of dairy farming. During the year, one of her barns was completely destroyed by fire. The adjusted basis of the barn was $90,000. The fair market value of the barn before the fire was $75,000. The barn was insured for 95% of its fair market value, and Alma recovered this amount under the insurance policy. Alma has adjusted gross income for the year of $40,000 (before considering the casualty). Determine the amount of loss she can deduct on her tax return for the current year.
d
POINTS: 1DIFFICULTY: EasyLEARNING OBJECTIVES: CMPV.SWFT.LO: 7-04 - LO: 7-04NATIONAL STANDARDS: United States - BUSPORG: AnalyticSTATE STANDARDS: United States - AK - AICPA: FN-Measurement -AICPA: FN-MeasurementKEYWORDS: Bloom's: ApplicationOTHER: Time: 5 min.

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