[jeff]

Welcome to the Q1 2017 CPA Exam Study Group for REG. 🙂

[aatoural]

Now that question lost me, why is the E&P included in AAA at the end of the year?

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[HoosierCPA]

@aatoural yeah I'm a little confused by that as well.

I'm wondering if E&P always relates to C Corp income and S Corp income is always AAA? So even though they don't say its sub chapter C E&P it's assumed the $75K in E&P is related to the C Corp and the $132K AAA (30+102) relates to the S Corp income.

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[RE2PECT]

It's a Gleim question so you should be confused lol. I'm getting so frustrated with their mcq's, I'm about to switch back to Ninja.

I saw it the same way as dtatham10 and added the ordinary income to AAA, which also increased the shareholder basis by the same amount.

FAR: 75 Roger & Ninja (notes/flashcards/audio/MCQ)
AUD: 73, 81
BEC: 71, retake 8/29
REG:

[jack yassa]

Hello Guys,

Individual taxation, Becker Sim2

-Schedule C revenue 50,000
-COGS 10,000
-Office sup 1,000
-Meals 4,000
-Self employment tax 2,600

How much is the Included income
My answer is to deduct 1/2 of the S/E tax! it was wrong. As i know we should deduct 1/2 SE FICA.
The correct answer was 37,000 not 38,300 as i thought.
Please help?

[HoosierCPA]

Revenue – COGS – Office Supplies – 50% Meals = 37k

The SE Tax is reported on the individual return and would not be part of schedule C income.

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[jack yassa]

@dtatham10
This was the head of the questions;
From the information provided, determine the amount of gross income to be reported on “the individual income tax return” and indicate the amount excluded from tax (if any).

he should report half of the S/E tax as adjustment to arrive at AGI, right ?

[HoosierCPA]

@gak yeah he should definitely report 1/2 the tax on the adjustments to arrive at AGI. I'm reading the question based on the info they provide what income from the schedule C activity needs to be reported on the individual return. From that point, you would exclude it from the schedule C.

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[jack yassa]

@dtatham10 thanks a lot that's really helpful.

[JMG]

@dtatham10 @aatoural thanks for clearing that up for me. I wasn't sure if the distribution was applied to them separately or one on top of the other if that makes sense.

[jeff]

2017 Update Video:

2017 CPA Exam Update Summary

[LIZZ]

So DODD FRANK wont be tested in 2017…. does anyone have an idea of what that is?

FAR - 05/2015
AUD - 75,11/2014
REG - 07/2015
BEC - 09/2015

[LIZZ]

Nevermind I just looked it up… Dont remember that in Becker but if its not tested I no longer care about it.

FAR - 05/2015
AUD - 75,11/2014
REG - 07/2015
BEC - 09/2015

[jack yassa]

Hello Guys,
Any ideas if you're studying from Becker what's does “AICPA adopted” means?

Thanks.

[aatoural]

No dod frank act!!! Yay one less topic out of Beckers chapter 8!

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[LIZZ]

Sorry @ aatoural

You were right there was a typo (my bad) May28th should be $22/share. So the last thing I dont understand is the new basis of 24. can you explain why you would add +2 to the May28th purchase price of 22? In my mind the new basis should be $22 because we sold the original 500 shares (or am i taking that to FAR (pun intended) and trying to make this a LIFO/FIFO inventory question).

DATE (Purch/Sale)– Shares /Price

Jan. 01 – (Purchase) — 500/$25
May 12 – (Sale)– 500/23
May 28 – (Purchase)– 250/$22
Oct 15 – (Sale)– 100/$18

ANSWER $1,100

FAR - 05/2015
AUD - 75,11/2014
REG - 07/2015
BEC - 09/2015

[Author]

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