ACCT8816: Federal Taxation
Problem Set 2 Solutions
1). The amount that Green Company should include in gross income is $10,000. Prepaid income from
rents cannot be deferred. However, the prepaid income of $50,000 can be deferred until earned.
ACCT 8816: Federal Taxation
Problem Set 3
1). John, age 43 and single, is the sole proprietor of a construction firm. The firm generated $100,000 in
revenues and $50,000 of ordinary business expenses. During the current year, John donated $500 t
ACCT8816: Federal Taxation
Problem Set 1
Team Members: Ying Li,
1). Chapter 17 Discussion Question #2
Cassowary Corporation need to report the ordinary operating income of
$120,000 and tax-exempt interest income of $8,00
FREESCALE SEMICONDUCTOR, INC.
Partners and employees of major accounting firms often have access to confidential client
information that they could use to gain an unfair advantage over other stock market investors.
Although the accountin
WILEY JACKSON, ACCOUNTING MAJOR
Similar to many recent accounting graduates, Wiley Jackson served an internship with a
major accounting firm while he was completing his undergraduate accounting degree. On the
final day of his internship,
ARVEL SMART, ACCOUNTING MAJOR
This brief case involves an ethical issue that many future accounting graduates have faced
in recent years. Internship programs are an important facet of the recruiting efforts of large
accounting firms. Tho
F&C INTERNATIONAL, INC.
Over two centuries, the Fries family of northern Kentucky and southern Ohio built a dynasty
of sorts in the flavor industry. Alex Fries, a German immigrant with a background in chemistry,
settled in Cincinnati dur
Here is a case that many of your students may be able to relate to personally. Two close
friends work together in a clothing store to help defray the cost of their college educations. Paula
is a marke
WAL-MART DE MEXICO
When Congress passed the Foreign Corrupt Practices Act (FCPA) in 1977, corporate
accountants and independent auditors feared that the new law would create major headaches for
them. That fear was unwarranted . . . at le
THE BOEING COMPANY
In January 2007, Matthew Neumann and Nicholas Tides, two Boeing employees, transferred
to the large aerospace companys internal audit department. The two men expected that their
new jobs would put them on a fast track
CREVE COUER PIZZA, INC.
In the early 1990s, the accounting profession was shocked when the news media revealed
that for several years a Missouri CPA had funneled confidential financial information regarding a
client to the IRS. The CPA h
FOAMEX INTERNATIONAL, INC.
In the years leading up to World War II, German scientist Otto Bayer discovered a new
chemical compound that would become known as polyurethane. Polyurethane foam was
developed in the early 1950s when water was
Employee theft is a widespread and serious problem facing the multitude of small
businesses that play such a critical role in the U.S. economy, which is the key reason that
phenomenon is a focal point of several of
GOODNER BROTHERS, INC.
Woody Robinson and Al Hunt were lifelong friends. Following graduation from college, Al
went to work for his father-in-law, who owned Curcios Auto Supply, a retail business located in
Huntington, West Virginia. Wit
FIRST KEYSTONE BANK
In January 2010, three tellers of a small branch of First Keystone Bank were arrested by
local law enforcement authorities and charged with embezzling more than $100,000 from the
branchs ATM over a period of two years
UNITED WAY OF AMERICA
Unfortunately, embezzlement and other fraudulent schemes are rife in the charity
industry. More than any other segment of our economy, the charitable sector has been
plundered by con artists and other miscreants in
HOWARD STREET JEWELERS, INC.
A common nemesis of small businesses is employee theft. Small business owners who place
too much trust in their employees can suffer significant financial losses at the hands of
apparently hard-working and tr
THE TROLLEY DODGERS
In this brief case, a longtime and trusted employee of the Los Angeles Dodgers engaged in a
large scale payroll fraud to embezzle funds from the organization. Over a period of several
years, this fraudulent scheme cos
LOCATEPLUS HOLDINGS CORPORATION
The management team of LocatePlus developed a New Age business model but relied on an
old-fashioned fraud scheme to burnish their companys financial statements. LocatePlus
collected a massive database tha
POWDER RIVER PETROLEUM INTERNATIONAL, INC.
Brian Fox, a Canadian with a background in the oil and gas industry, took control of
Powder River in late 2003. Fox became not only the principal stockholder of the small
company but also its CE
CBI HOLDING COMPANY, INC.
Ernst & Young audited the pharmaceutical wholesaler CBI Holding Company, Inc., in the
early 1990s. In 1991, Robert Castello, CBIs owner and chief executive, sold a 48% stake in his
company to TCW, an investment
David Robinson, an audit senior assigned to the audit engagement team for Belot
Enterprises, faces a dilemma common to auditors. Client management has taken an aggressive
position regarding the period-ending balances of
GEO SECURITIES, INC.
In the late 1990s, Geo Companies of North America (GNCA), a small Dallas-based
company, organized a wholly-owned subsidiary, Geo Securities, Inc., to market interests in oil
and gas properties that it owned or contro
TAKE-TWO INTERACTIVE SOFTWARE, INC.
Grand Theft Auto is the sixth best-selling video game franchise of all time and easily
ranks among the most controversial as well. The games adult content has resulted in caustic
and unrelenting critic
LIPPER HOLDINGS, LLC
Media reports described Kenneth Lipper as a bon vivant and renaissance man. Lipper,
the son of a shoe salesman, grew up in a modest working-class neighborhood in the South
Bronx. A childhood friend of Al Pacino and a
GENERAL MOTORS COMPANY
Billy Durant created General Motors Corporation in 1908 when he merged several
automobile manufacturers that he had acquired over the previous few years. For most of the
20th century, GM reigned as the largest auto
GOLDEN BEAR GOLF, INC.
According to one sports announcer, Jack Nicklaus became a legend in his spare time.
Nicklaus still ranks as the best golfer of all time in the minds of most pasture pool aficionados
granted, he may lose that title
JACK GREENBERG, INC.
In the mid-1980s, Emanuel and Fred Greenberg each inherited a 50 percent ownership
interest in a successful wholesale business established and operated for decades by their father.
Philadelphia-based Jack Greenberg,