Differences Between Tax and Financial Accounting (14)

Question 1

What corporations are required to file Form 1120, Schedule M-3?

Answer 1

Corporations with total assets of $10 million or more

Question 2

Schedule M-1 of IRS Form 1120 is required to be filed when a corporation has

Answer 2

both total assets and total receipts of $250,000 or more.

Question 3

For tax years beginning after 1993, what percentage of business meals are deductible.

Answer 3

only 50%

Question 4

items should be included on Schedule M-1, Reconciliation of Income (Loss) per Books With Income per Return, of Form 1120, U.S. Corporation Income Tax Return, to reconcile book income to taxable income?

Answer 4

Premiums paid on key-person life insurance policy

Question 5

Assets are generally expensed over a longer period of time for the financial statements and deducted over a shorter period of time for the tax return due to

Answer 5

differences in book depreciation methods versus tax depreciation methods.

Question 6

differences in book depreciation methods versus tax depreciation methods.

Answer 6

$3,000 paid to a professional lobbyist to lobby Congress

Question 7

Corporations can carry capital losses back three years and forward

Answer 7

Five years

Question 8

are not allowed a deduction for capital losses but They can only be used to offset capital gains

Answer 8

Corporations

Question 9

What disclosures that is not required when filing Schedule M-3 of Form 1120?

Answer 9

• consolidated versus nonconsolidated returns.
• whether certified audited versus nontax basis was used for the income statement.
• whether or not the income statement had been restated in the previous five years (not seven years).

Question 10

a corporation is not required to file Schedule M-1 (Reconciliation of Income (Loss) per Books with Income per Return) along with their Form 1120 if:

Answer 10

total assets and total receipts are less than $250,000.