Reference no: EM132071515

Questions -

1) Bill files as head of household in 2014. He had taxable income of $90,000, including the sale of stock he held for investment for two years for a $20,000 gain. Bill sold no other assets during the year, and he did not have any capital loss carryovers.

1. What is Bill's 2014 tax liability?

2. What would Bill's 2014 tax liability be if he had held the stock for 10 months?

2) For tax purposes, which of the following costs must be included in inventory of a manufacturing company?

1. Raw materials

2. Advertising

3. Payroll taxes for factory employees

4. Research and experimental costs

5. Factory insurance

6. Repairs to factory equipment

7. Factory utility costs

8. Factory rent

3) Lloyd gifted property to Louise. Lloyd's basis in the property was $1,200. The fair market value at the time of the gift was $1,400. Louise sold the property for $2,500. What was the amount of Louise's gain on the disposition?

a. $0

b. $1,100

c. $1,300

d. $2,500

4) Ronald, a calendar-year taxpayer, purchased used furniture and fixtures for use in his business and placed the property in service on November 1, 2014. The furniture and fixtures cost $56,000 and represented Ronald's only acquisition of depreciable property during the year. Ronald did not elect to expense any part of the cost of the property under Sec. 179. What is the amount of Ronald's depreciation deduction for the furniture and fixtures under the Modified Accelerated Cost Recovery System (MACRS) for 2014?

1. $ 2,000

2. $ 2,667

3. $ 8,000

4. $16,000