[jeff]

Welcome to the Q1 2016 CPA Exam Study Group for REG.

Some BLITZ videos to help your exams: https://www.another71.com/ninja-blitz

[nib]

what is rule against perpetuities ??? pls explain .

To which of the following trusts would the rule against perpetuities not apply?

A. Charitable
B. Spendthrift
C. Totten
D. Constructive

correct answerr = charitable

[Future Ninja]

#1. question on distribution of partnership asset:

As a general partner in Greenland Associates, an individual’s share of partnership income for the current tax year is $25,000 ordinary business income and a $10,000 guaranteed payment. The individual also received $5,000 in cash distributions from the partnership. What income should the individual report from the interest in Greenland?

A. $5,000
B. $25,000
C. $35,000
D. $40,000

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

these are true?

to compute basis of partner = deduct the cash distribution.
to compute the income/interest of the partnership = do not include the current distribution (cash).

those were the items i learned from practicing mcq. please let me know if those are correct. Thank you.

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

#2.

Gilroy, a calendar-year taxpayer, is a long-time partner in the firm of Adam and Company, which has a fiscal year ending June 30. The partnership agreement provides for Gilroy to receive 25% of the ordinary business income of the partnership. Gilroy also receives a guaranteed payment of $1,000 monthly, which is deductible by the partnership. The partnership reported ordinary business income of $88,000 for the year ended June 30, 2015, and $132,000 for the year ended June 30, 2016. How much should Gilroy report on his 2015 return as total income from the partnership?

A. $25,000
B. $55,000
C. $34,000
D. $28,000

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

rise and grind! happy V-day!

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

did you know that:

GAIN ON SALE TO URP is only recognized ONLY TO THE EXTENT that exceeds the PREVIOUSLY DISALLOWED LOSS.

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

Where are you guys???

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

#3.

PDK, LLC, had three members with equal ownership percentages. PDK elected to be treated as a partnership. For the tax year ending December 31, Year 1, PDK had the following income and expense items:

Revenues ……………………$120,000
Interest income……………….6,000
Gain on sale of securities….8,000
Salaries……………………….36,000
Guaranteed payments……..10,000
Rent expense………………..21,000
Depreciation expense ……18,000
Charitable contributions….3,000

What would PDK report as non-separately stated income for Year 1 tax purposes?

A. $30,000
B. $35,000
C. $43,000
D. $51,000

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[nib]

@ Future Ninja
ANSWER = 35000 =25000+10000 = INCOME of partnership
5000 contribution reduce basis in partnership

following is correct
to compute basis of partner = deduct the cash distribution.
to compute the income/interest of the partnership = do not include the current distribution (cash).

[nib]

hello,
In below quetion 15000 received from bingo game . I thought it was business incomenot related to exempt organization . and so it will be taxed as unrelated busines income .
why ? it is then exempt from unrelated busines income .,

Help, Inc., an exempt organization, derived income of $15,000 from conducting bingo games. Conducting bingo games is legal in Help’s locality and is confined to exempt organizations in Help’s state. Which of the following statements is true regarding this income?

Incorrect A. The entire $15,000 is subject to tax at a lower rate than the corporate income tax rate.
B. The entire $15,000 is exempt from tax on unrelated business income.
C. Only the first $5,000 is exempt from tax on unrelated business income.
D. Since Help has unrelated business income, Help automatically forfeits its exempt status for the current year.

correct answer is= c= The entire $15,000 is exempt from tax on unrelated business income.

[nib]

@ future ,
whatever recd in 2015 is taxed .

34000 = 88000 *.25 % + 12000
12000 is already deducted from 88000 .

[nib]

@ future,
120000 REVENUES
-36000 SAL
-10000 GAURANTEED PAYMENT
-21000 RENT EXPENSE
-18000 DEPRECIATION

35000 Non separately stated

separately stated =
Interest income……………….6,000
Gain on sale of securities….8,000
Charitable contributions….3,000

[Future Ninja]

hey guys! where are you? need help please for those posted 3 questions. please.

@AMOR D – help please.

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[nib]

REPOST
@ FUTURE
@ future,
120000 REVENUES
-36000 SAL
-10000 GAURANTEED PAYMENT
-21000 RENT EXPENSE
-18000 DEPRECIATION

35000 Non separately stated

separately stated =
Interest income……………….6,000
Gain on sale of securities….8,000
Charitable contributions….3,000

Individual can claim on their tax as per their limit .

[TheWheelHouse]

#1 I got C. Distributions reduce the partner's basis, and are not included in income from the business.
#2 I got C. 88,000 * 0.25 = 22,000 + (1000 * 12 months) for the guaranteed payments = $34,000 for the year 2015
#3 I got B. Revenue of 120,000 reduces by salaries, guaranteed payments, rent expense, and depreciation (other expenses are separately stated) = $35,000.

Let me know if those are right, I tried to leave a brief explanation for each. I'm taking the test next Monday!

REG - 81 2/22/2016
FAR - 85 5/19/2016
AUD - 86 4/02/2016
BEC - 7/16/2016

[Author]

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