Free AICPA AICPA-CPA Exam Questions

Sam rents his second home. During the current year, he reported a $40,000 net loss from the rental. Assume Sam actively participates in the rental activity and no phase-out limitations apply. What is the greatest amount of the rental loss that Sam can deduct against ordinary income in the current year?

Adams, Beck, and Carr organized Flexo Corp. with authorized voting common stock of $100,000. Adams received 10% of the capital stock in payment for the organizational services that he rendered for the benefit of the newly formed corporation. Adams did not contribute property to Flexo and was under no obligation to be paid by Beck or Carr. Beck and Carr transferred property in exchange for stock below. What amount of gain did Carr recognize from this transaction? Adjusted Basis / Fair Market Value / % of Flexo Stock Acquired Beck: $5,000 $20,000 20% Carr: $60,000 $70,000 70%

Adams, Beck, and Carr organized Flexo Corp. with authorized voting common stock of $100,000. Adams received 10% of the capital stock in payment for the organizational services that he rendered for the benefit of the newly formed corporation. Adams did not contribute property to Flexo and was under no obligation to be paid by Beck or Carr. Beck and Carr transferred property in exchange for stock below. What amount of gain did Carr recognize from this transaction? Adjusted Basis / Fair Market Value / % of Flexo Stock Acquired Beck: $5,000 $20,000 20% Carr: $60,000 $70,000 70%

Gareth, a sales tax registered trader purchased a computer for use in his business. The invoice for the computer showed the following costs related to the purchase: $ Computer 890 Additional memory 95 Delivery 10 Installation 20 Maintenance (1 year) 25 –––––– 1,040 Sales tax (17·5%) 182 –––––– Total 1,222 –––––– How much should Gareth capitalise as a non-current asset in relation to the purchase?

At 30 June 20X5 a company’s allowance for receivables was $39,000. At 30 June 20X6 trade receivables totalled $517,000. It was decided to write off debts totalling $37,000 and to adjust the allowance for receivables to the equivalent of 5% of the trade receivables based on past events. What figure should appear in the statement of profit or loss for the year ended 30 June 20X6 for receivables expense?