Explain why tax allocation is necessary.
What will be an ideal response?
ANSWER:
Tax allocation is necessary because of timing differences between when a revenue or expense item reaches the published financial statements as opposed to when it appears on the tax return. In these situations, tax expense is based on the published before-tax income figure, while the tax liability is based on the tax return. This problem can also be viewed from the perspective of the balance sheet, where the tax basis and book basis of assets and liabilities differ.
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To enable customers to draw conclusions about a brand's service, service companies face the challenge of making their intangible services seem ________.
A. less perishable B. less inseparable C. more imperceptible D. less reliable E. more tangible
Under the UCC, good faith means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade
Indicate whether the statement is true or false
WQP Company generated $1,814,700 ordinary income from the sale of inventory to its customers. It also sold three noninventory assets during the year. Compute WQP's taxable income assuming that: a. The first sale resulted in a $10,400 ordinary gain, the second sale resulted in a $23,900 capital loss, and the third sale resulted in a $44,000 capital gain. b. The first sale resulted in a $79,100 capital loss, the second sale resulted in a $35,200 ordinary loss, and the third sale resulted in a $16,000 capital gain.
What will be an ideal response?
Forward contracts are traded over-the-counter and are generally not standardized
Indicate whether the statement is true or false