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Question 5 2 pts 5- Tobin Corporation (a calendar year taxpayer) has taxable income of $300,000, and its financial records reflect the following for the year. Federal income taxes paid $110,000 Excess of capital losses over capital gains 70,000 Gain recognized this year on an installment sale from a prior year 44,000 MACRS depreciation deducted on the tax return in excess of ADS depreciation was 30,000: MACRS 40,000 AND ADS $10,000 . Interest income on lowa (muni) state bonds 8,000 What is Tobin's current E&P? o 334,000 114,000 . 124,000 474,000 Question 6 2 pts 6 - Tobin Corporation, an accrual basis corporation, has taxable income of $150.000 in the current year. Included in its determination of taxable income are the following transactions. Brown incurred a $65,000 capital loss from the sale of stock Because Brown had no capitalgains this year, none of the loss is deductible. The corporation's Federal income tax liability (expense) is $31.500. Brown incurred $18,000 in nondeductible meal expenses Brown uses the LIFO method when accounting for inventory. This year, the company's LIFO recapture amount increased by $3.000. Brown claimed a dividends received deduction of $1,500. What is Tobin Corporation's current EXP? 34000 170.000 75.000 40.000 There are 3 questions that relate to this scenario: 7 -At the beginning of the current year, both Maggie and Torri each own 50% of Tobin Corporation (a calendar year taxpayer). In July, Maggie sold her stock to Carter. At the beginning of the year, Tobin Corporation had accumulated E&P of $240,000 and its current E&P is $280,000 (prior to any distributions). Tobin Corporation distributed $300,000 on February 15 ($150,000 to Maggie and $150,000 to Torri) and distributed another $300,000 on November 1($150,000 to Carter and $150,000 to Torri). Total distributions for the year totaled $600,000. Remember Carter did not get stock until July. Assume Carter has adequate stock basis. NOTE: WORK THIS LIKE I DID FOR EXAMPLE 10 MAKING TABLES WITH THE SHAREHOLDERS As a result of this transaction, Carter has DIVIDEND INCOME: 150,000 70,000 o 30,000 o 110,000 Question 8 2 pts 8-At the beginning of the current year, both Maggie and Torri each own 50% of Tobin Corporation (a calendar year taxpayer). In July. Maggie sold her stock to Carter. At the beginning of the year, Tobin Corporation had accumulated E&P of $240,000 and its current E&P is $280,000 (prior to any distributions). Tobin Corporation distributed $300,000 on February 15 (5150,000 to Massie and $150,000 to Torri) and distributed another $300,000 on November 1 ($150,000 to Carter and $150,000 to Torri). Total distributions for the year totaled $600,000 Remember Carter did not get stock until July. Assume Carter has adequate stock basis. As a result of this transaction Carter has RETURN OF CAPITAL 40.000 70.000 20,000 110.000 Question 9 2 pts 9-At the beginning of the current year, both Maggie and Torri each own 50% of Tobin Corporation (a calendar year taxpayer). In July, Maggie sold her stock to Carter. At the beginning of the year, Tobin Corporation had accumulated E&P of $240,000 and its current E&P is $280,000 (prior to any distributions). Tobin Corporation distributed $300,000 on February 15 ($150,000 to Maggie and $150,000 to Torri) and distributed another $300,000 on November 1 ($150,000 to Carter and $150,000 to Torri). Total distributions for the year totaled $600,000. Remember Carter did not get stock until July. Assume Carter has adequate stock basis. As a result of this transaction, Carter has CAPITAL GAIN: 70,000 o 80,000 100,000

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