k***1
发帖数: 4 | 1 5. CPA-02039
In 1994, Starke Corp., an accrual-basis calendar year corporation, reported
book income of $380,000.
Included in that amount was $50,000 municipal bond interest income, $170,000
for federal income tax
expense, and $2,000 interest expense on the debt incurred to carry the
municipal bonds. What amount
should Starke's taxable income be as reconciled on Starke's Schedule M-1 of
Form 1120, U.S.
Corporation Income Tax Return?
a. $330,000
b. $500,000
c. $502,000
d. $550,000
我的问题是为什么最后要加Interest to carry municipal bonds 2,000？ 这个
应该算是general interest expense, which is tax deductible, 我觉得应该要从
book income里减去2,000呀？
请指教
Choice "c" is correct. Municipal bond interest, interest on debt incurred
to carry the municipal bonds, and
federal income tax expense are not included in taxable income.
Reported book income $380,000
Municipal bond interest (50,000)
Federal income tax expense 170,000
Interest to carry municipal bonds 2,000
Taxable income $502,000
Choices "a", "b", and "d" are incorrect. Each of these answers does not
take into account at least one of
the items of the above calculation. | c*****a
发帖数: 1577 | 2 这个interest expense 已经被减去了when arriving the book income. 因为是non
deductible , 算taxable income的时候要加回去。
【在 k***1 的大作中提到】
: 5. CPA-02039
: In 1994, Starke Corp., an accrual-basis calendar year corporation, reported
: book income of $380,000.
: Included in that amount was $50,000 municipal bond interest income, $170,000
: for federal income tax
: expense, and $2,000 interest expense on the debt incurred to carry the
: municipal bonds. What amount
: should Starke's taxable income be as reconciled on Starke's Schedule M-1 of
: Form 1120, U.S.
: Corporation Income Tax Return?
| f*******3
发帖数: 160 | 3 请问,为什么是non-deductible item 呢?
【在 c*****a 的大作中提到】
: 这个interest expense 已经被减去了when arriving the book income. 因为是non
: deductible , 算taxable income的时候要加回去。
| P*****7
发帖数: 80 | 4 Interest expense used to purchase tax-free bonds is not deductible
(because the interest earned on the bonds is not taxable).
$2,000 interest expense on the debt incurred to carry the
municipal bonds. 这里的municipal bonds 是tax-free bonds，所以这个$2,000
interest expense是not deductible
呢?
【在 f*******3 的大作中提到】
: 请问,为什么是non-deductible item 呢?
| f*******3
发帖数: 160 | 5 多谢答复, 看过的知识点到用的时候都想不起来了.
【在 P*****7 的大作中提到】
: Interest expense used to purchase tax-free bonds is not deductible
: (because the interest earned on the bonds is not taxable).
: $2,000 interest expense on the debt incurred to carry the
: municipal bonds. 这里的municipal bonds 是tax-free bonds，所以这个$2,000
: interest expense是not deductible
:
: 呢?
| k***1
发帖数: 4 | 6 恩 赞 赞
【在 c*****a 的大作中提到】
: 这个interest expense 已经被减去了when arriving the book income. 因为是non
: deductible , 算taxable income的时候要加回去。
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