Which one of the following would constitute a highly inflationary economy when determining the functional currency of a foreign entity?
(A)20% inflation for each of the past 5 years.
(B)30% inflation for each of the past 3 years.
(C)35% inflation for each of the past 3 years.
(D)20%, 35%, and 40% inflation, respectively, for each of the past 3 years.
Cartman's Cats had a total of 100,000 shares of common stock issued. In February, they reacquired 20,000 shares and did not retire them. How many shares of outstanding stock do they currently have? Mark one answer:
(A)100,000 (B)120,000 (C)20,000 (D)60,000 (E)80,000
Correct Answer: E
A tax return preparer may disclose or use tax return information without the taxpayer’s consent to
(A)Facilitate a supplier’s or lender’s credit evaluation of the taxpayer. (B)Accommodate the request of a financial institution that needs to determine the amount of taxpayer’s debt to it, to be forgiven. (C)Be evaluated by a quality or peer review. (D)Solicit additional nontax business.
Correct Answer: C
If an exempt organization is a corporation, the tax on unrelated business taxable income is
(A)Computed at corporate income tax rates. (B)Computed at rates applicable to trusts. (C)Credited against the tax on recognized capital gains. (D)Abated.
Correct Answer: A
More CPA Exam Questions
- 1Jim's Jeans decided to shut down their Jimmy Jean Division. Where on the income statement would this closing be addressed? Mark one answer:
- 2A tax return preparer may disclose or use tax return information without the taxpayer’s consent to
- 3Bart’s Brewskies has grown beyond its wildest dreams. They are now a corporation and have hired an accountant. Their income statement is now showing a net income. How is this income shown on the Statement of Retained Earnings? (I) It increases retained earnings.(I). It is shown as dividends paid to shareholders.(I)I. It does not impact the Statement of Retained Earnings. Mark one answer:
- 4Common stock has a _____ balance and is a/an _____ to the Corporation.
- 5Which of the following is subtracted from net sales to determine gross profit?