Day 26

Question 1

Define: Unilateral contract

Answer 1

Is formed when a promise is exchanged for an act

MCQ-02291

Question 2

True or False: Only one party makes a promise in a Unilateral Contract

Answer 2

True

MCQ-08881

Question 3

What is required for an offer to be “sufficient”?

Answer 3

The communication of the offer must be a reasonable expectation

EX: selling a laptop for $1 is NOT reasonable

MCQ-04964

Question 4

When is a promise to keep an offer open enforceable?

Answer 4

When consideration is given

EX: Bob’s promise not to buy another computer = consideration given

MCQ-04967

Question 5

Does a death terminate a contract?

Answer 5

Yes, the death of the offeror proof to acceptance terminated the offer by operation of law without notice to the offeree

MCQ-02222

Question 6

When is the Mailbox Rule in effect?

Answer 6

Under Common Law, when the offer does not specify that acceptance is upon receipt, and does not specify the means of acceptance

MCQ-02489

Question 7

What is the requirement for effective consideration?

Answer 7

Legally Sufficient

MCQ-01347

Question 8

When is valid consideration present?

Answer 8

If there is a bargained for exchange of something of legal value

NOTE: if the promised act has already been performed then the bargained element fails

MCQ-01130

Question 9

How can a contract with a minor be ratified?

Answer 9

• failing to disaffirm within a reasonable time after reaching majority
• expressly ratifying the entire contract orally or in writing
• retaining or accepting the benefits

Question 10

What is requirements to create an Agency?

Answer 10

• Assent of both parties
• Capacity of principal

NOTE: Consideration is not required

Question 11

What are the duties of a Principal to the Agent?

Answer 11

• Compensation
• Reimbursement

Question 12

Define: Actual (real) Authority

Answer 12

Actual authority is the authority the Agent reasonably thinks he has based on communications with the principal

Question 13

Define: Implied Authority

Answer 13

Actual Authority: (Two Types)

1. Implied Authority - Authority from position, past acts, and circumstances
2. Expressed Authority - Authority specifically granted by the principal

Question 14

Define: Expressed Authority

Answer 14

Actual Authority: (Two Types)

1. Implied Authority - Authority from position, past acts, and circumstances
2. Expressed Authority - Authority specifically granted by the principal

Question 15

What is the overall limitation for the QBI Deduction?

Answer 15

The LESSER OF: the combined QBI deductions or 20% of the taxpayer’s taxable income in excess of net capital gain

MCQ-08791

Question 16

Test #1: What is the QBI deduction limited to? The Greater of:

Answer 16

THE GREATER OF:

1. 50% of W-2 wages for the business; OR
2. 25% of W-2 wages, plus 2.5% of UBIA (PP&E)

MCQ-08791

Question 17

Requirements for Incentive Stock Options:

Answer 17

1. Approved by shareholders
2. Granted within 10 years
3. Exercise price may not be less than FMV
4. Employee CANNOT own more than 10%
5. Held at least TWO YEARS
6. Employee must remain an employee from the date the option is granted until 3 Months before the option is exercised

MCQ-07357

Question 18

When is a 90-Day Letter (Notice of Deficiency) issued?

Answer 18

If an Appeals Conference was not requested OR the taxpayer and the IRS do not agree on the proposed adjustments

The taxpayer has 90 days to pay the deficiency OR file a Petition with the U.S. Tax Court

MCQ-08956

Question 19

Bankruptcy: Debts that cannot be discharged

*WAFTED

Answer 19

• Willful negligence / injury
• Alimony
• Fraud (Fines an penalties owed to the government)
• Taxes (within 3 years)
• Educational loans
• Debts undisclosed in bankruptcy court

MCQ-01837

Question 20

What income is subject to FICA for an employee and Self-Employed person?

Answer 20

Employee - Gross Wages

Self-Employed - Net Profits

MCQ-02546

Question 21

What assets are included in a debtor’s bankruptcy estate if they were received after the petition was filed?

Answer 21

Assets received 180 days after the petition that will be included in the debtor’s estate are:

• Proceeds from Life Insurance
• Inheritance
• Divorce Settlements

MCQ-01883

Question 22

Article 9: Secured Transactions include what?

Answer 22

Applies to the contractual security interest of Personal Property and the Outright Sales of Accounts Receivable

MCQ-01830

Question 23

What is a defence for Fraud in a Surety loan agreement?

Answer 23

Fraud on the surety by the principal debtor is not a defense unless the creditor knew of the fraud.

MCQ-01849