Gwen and Travis organized a new business as an LLC in which they own equal interests. The new business generated a $10,000 operating loss its first year. Travis has no other taxable income for the current year, but expects to have sufficient taxable income in future years to pay tax in the 24% tax bracket. Which of the following statements regarding Travis' tax savings from the current LLC loss is true?
A. Travis can carry his share of LLC loss forward, and will get tax savings only when he generates future income.
B. Travis can only use his share of the LLC loss in the current year, and will receive no tax savings.
C. The LLC will reallocate Travis share of the loss to Gwen, who can claim $1,750 of additional tax savings.
D. Travis can carry his share of LLC loss back two years as a net operating loss, and request an immediate tax refund of $1,200.
Answer: A
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Clearwater Hampers is a small British company that sells luxury food and drink in various combinations in picnic hampers. Food and wine are seen as classic, fail-safe gifts in a market where present-buying is increasingly tricky. Corporate customers, both in the United Kingdom and abroad, are important to the business. Clearwater has had several orders for more than a quarter of a million dollars. The company's leading salesperson is Peter Austin, who sees his company "as a service company rather than a food and drink business. Our priority is to get the hampers out on time, filled with the right products." Austin often checks to see if his customers are satisfied with his service.Austin phones a recipient of one of Clearwater's deluxe hampers to inquire if the picnic basket arrived on
time and undamaged, which suggests that Austin engages in: A. transaction selling. B. partnering/consultative selling C. relationship selling. D. direct selling. E. transformational selling.
Carpark Services began operations in 20X1 and maintains long-term investments in available-for-sale debt securities. The year-end cost and fair values for its portfolio of these investments follow. The year-end adjusting entry to record the unrealized gain/loss at December 31, 20X2 is:Available-for-Sale Debt SecuritiesCost Fair ValueDecember 31, 20X1$246,000? $236,900?December 31, 20X2$330,000? $325,600?December 31, 20X3$425,000? $429,400?
A. Debit Fair Value Adjustment - Available-for-Sale (LT) $4700; Credit Unrealized Loss - Equity $4700. B. Debit Unrealized Gain - Equity $4400; Credit Fair Value Adjustment - Available-for-Sale (LT) $4400. C. Debit Fair Value Adjustment - Available-for-Sale (LT) $4400; Credit Unrealized Gain - Equity, $4400. D. Debit Fair Value Adjustment - Available-for-Sale (LT) $4400; Credit Unrealized Loss - Equity $4400. E. Debit Fair Value Adjustment - Available-for-Sale (LT) $4700; Credit Unrealized Gain - Equity $4700.
By cutting back operations to match areas of declining demand and moving some operations overseas, Hewlett-Packard anticipates a reduction in costs of more than $2 billion. But despite having made significant progress toward being a smaller, more nimble company, significant challenges in returning to profitability still remain. Hewlett-Packard is a good example of
A. reducing cycle times in getting new products to market B. strategic fits in R&D or technology development to boost sales in both the parent company and the diversified businesses C. achievement of cost savings in research and development areas D. pursuing a strategy of corporate restructuring E. strategic fits in innovation to allow for a greater number of new products or processes
Discuss the similarities between a teen's decision to text-message whilst driving and an executive's decision to not perform routine maintenance in the interest of saving on costs at a plant