Quiz for Part 4


1	Maynard Corporation received $300,000 in dividends from a company in which it owns 12 percent. Its operating revenues for the period are $1,200,000 and operating expenses are $1,110,000. What is Maynard’s dividend received deduction?
		A)	$160,000
		B)	$240,000
		C)	$210,000
		D)	$152,000
		E)	Some other answer


2	A, B, and C contribute assets for an equal share in the ABC partnership. C contributed an asset with a FMV of $60,000 and a basis to C of $20,000. The asset was subject to a liability of $30,000 which the partnership assumed. How much will A's basis in his/her partnership interest increase (decrease) because of C's contribution?
		A)	$0
		B)	$(20,000)
		C)	$10,000
		D)	$(10,000)
		E)	$20,000


3	Ando Partnership experienced and operating loss of $60,000 this period. The equal partners, C, D, E had a basis in their partnership interest of $18,000, $15,000, $40,000, respectively. Assuming no other adjustments to their basis, how much, in total , of the operating loss will flow-through to the partner's individual tax returns?
		A)	$60,000
		B)	$50,000
		C)	$55,000
		D)	$33,000
		E)	$53,000


4	Myran Corporation has taxable income of $250,000 during the current period. Compute Myran's tax liability.
		A)	$22,250
		B)	$87,500
		C)	$80,750
		D)	$58,500
		E)	Some other amount.


5	Parrot Corporation's regular taxable income for the year is $150,000. the corporation has positive AMT adjustments of $40,000 and a $22,000 AMT tax preference. Based on these facts compute Parrot's AMT liability (if any) for the year.
		A)	$0
		B)	$41,750
		C)	$37,500
		D)	$4,250
		E)	Some other answer.


6	Blanko Corporation has operating revenues of $250,000 and operating expenses of $240,000. It also received $100,000 of dividends from a corporation it had a 25 percent ownership interest in. What is Blanko's dividend received deduction?
		A)	$88,000
		B)	$70,000
		C)	$80,000
		D)	$100,000
		E)	Some other answer


7	One advantage of using a flow-through entity for conducting business is that all losses are deducted in the period they occur.
		A)	True
		B)	False


8	An advantage of being a limited partner is that limited partners are liable for partnership debt only to the extent of their capital contribution.
		A)	True
		B)	False


9	An S corporate shareholder may increase the amount of losses deducted during any period by making a loan to the corporation. The same is true for partners in a partnership.
		A)	True
		B)	False


10	Sharon is a 25 percent shareholder in SBU Corporation, a calendar year S corporation. SBU incurred a $100,000 loss for the current period. If Sharon's basis in her SBU stock is $20,000. She also has a basis of $10,000 in a note receivable from the e corporation. How much of the current loss can Sharon deduct on her personal return?
		A)	$100,000
		B)	$25,000
		C)	$20,000
		D)	$0
		E)	Some other answer.

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