Question : 69. Avocado Corporation paid $3,000 in estimated tax payments for the : 1313628

69. Avocado Corporation paid $3,000 in estimated tax payments for the calendar year ended December 31, 2014. The corporation has an actual tax liability of $4,000 for the year. 

a.If no extension is requested, when is the tax return due?

b.If an extension of time to file is requested and approved, when is the tax return due?

c.If an extension of time to file is requested and approved, when is the additional $1,000 of the 2014 tax due?

ANSWER:  a.

?March 16, 2015 (Note that when the filing date falls on a Saturday or a Sunday, the actual filing date is the next business day).

b.

?September 15, 2015 (Note that when the filing date falls on a Saturday or a Sunday, the actual filing date is the next business day).

c.

?March 16, 2015 (Note that when the filing date falls on a Saturday or a Sunday, the actual filing date is the next business day).

POINTS:  1

QUESTION TYPE:  Subjective Short Answer

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-05 – LO:11-05

70. XYZ Corporation has a December 31 year-end.a. When is XYZ Corporation’s tax return due?b. When does XYZ Corporation need to make its estimated tax payments?c. Assuming that XYZ Corporation owes $5,000 on the original tax return due date and it files for an extension and is granted an automatic extension to file tax returns, what is the extended tax return date and when should taxes be paid?

ANSWER:  a. March 15 of the following year.bApril 15, June 15, September 15, and December 15c. The extended tax due date is September 15 of the following year, but the taxes owed should be paid by March 15 after the year end.

POINTS:  1

QUESTION TYPE:  Subjective Short Answer

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-05 – LO:11-05

71. During the current year, The Jupiter Company, which is an S corporation, had the following items of income and expenses: 

Gross income from operations $137,000

Gain on sale of business assets $ 5,000

Qualified dividend income from investments $ 100

Deductions:

Salaries to employees $ 65,000

Payroll taxes $ 6,000

Rent $ 7,000

Depreciation $ 3,500

Contributions to United Way charity $ 2,000

Foreign tax paid on overseas business deals $ 3,000

Distributions to the shareholders $ 40,000

?

a. Calculate the net ordinary income.b. List all the other items which must be separately reported.c. If the S corporation is on a calendar year, when is the corporation’s tax return due?

ANSWER:  a. Ordinary income:

Gross income from operations $137,000

Less:

Salaries $(65,000)

Payroll taxes $ (6,000)

Rent $ (7,000)

Depreciation $ (3,500)

Net ordinary income

? $ 55,500

?

b. Items which need to be separately reported:

Gain on sale of business assets $ 5,000

Dividend income $ 100

Charitable contributions to United Way $ 2,000

Foreign tax paid $ 3,000

Distributions to the shareholders $40,000

?

c.March 15 of the following year

?

POINTS:  1

QUESTION TYPE:  Subjective Short Answer

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-05 – LO:11-05ITF.WABG.15.LO:11-06 – LO:11-06