Principles Of Taxation For Business And Investment Planning 2020 Edition
23rd Edition
ISBN: 9781259969546
Author: Sally Jones, Shelley C. Rhoades-Catanach, Sandra R Callaghan
Publisher: McGraw-Hill Education
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Chapter 2, Problem 4IRP
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Determine the tax issue or issues suggested by the following situations, and state that issue in the form of question.
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A corporation has an excess input VAT due to its excessive local purchases of goods and
services. This excess input VAT is accumulating every month and reached a significant value.
The management is considering to deal with the excess input VAT.
a. Determine the best option for the corporation in treating its excess input VAT to gain
maximum tax benefit. Justify your answer.
b. Assume that the excess input VAT is directly attributable to its Zero-rated VAT Sales,
explain the options that could possibly be considered by the management.
Each year the government loses 17 cents out of every dollar due on income taxes because of cheating by taxpayers. The cheating may take the form of not reporting income or taking nonexistent or unjustified deductions. The total loss to the government is more than $100 billion a year. This represents the unpaid taxes of otherwise honest Americans, not the additional tens of billions hidden by drug czars and other hardened criminals. If all taxes were properly collected, a portion of our federal deficit could be wiped out. The most frequent offenders are the self-employed. A General Accounting Office (GAO) study revealed that auto dealers, restaurateurs, and clothing store operators underreport their taxable income by nearly 40 percent. Doctors, lawyers, barbers, and accountants underpay (cheat?) on 20 percent of their revenues.
The most proficient of the nonreporters are in the food-service industry. Collectively, waiters and waitresses fail to report 84 percent of their tips, according…
A corporation has an excess input VAT due to its excessive local purchases of goods and
services. This excess input VAT is accumulating every month and reached a significant value.
The management is considering to deal with the excess input VAT.
Determine the best option for the corporation in treating its excess input VAT to gain
maximum tax benefit.
Chapter 2 Solutions
Principles Of Taxation For Business And Investment Planning 2020 Edition
Ch. 2 - What evidence suggests that the federal tax system...Ch. 2 - Prob. 3QPDCh. 2 - National governments have the authority to print...Ch. 2 - In each of the following cases, discuss how the...Ch. 2 - Prob. 6QPDCh. 2 - Ms. V resides in a jurisdiction with a 35 percent...Ch. 2 - What nonmonetary incentives affect the amount of...Ch. 2 - Prob. 9QPDCh. 2 - Prob. 10QPDCh. 2 - Discuss the tax policy implications of the saying...
Ch. 2 - Prob. 12QPDCh. 2 - Jurisdiction E spends approximately 7 million each...Ch. 2 - Prob. 14QPDCh. 2 - Prob. 15QPDCh. 2 - Corporation R and Corporation T conduct business...Ch. 2 - Ms. P is considering investing 20,000 in a new...Ch. 2 - Country M levies a 10 percent excise tax on the...Ch. 2 - The city of Lakeland levies a 2 percent tax on the...Ch. 2 - The city of Clement levies a 5 percent tax on the...Ch. 2 - Mrs. K, a single taxpayer, earns a 42,000 annual...Ch. 2 - Prob. 5APCh. 2 - Prob. 6APCh. 2 - Prob. 7APCh. 2 - Jurisdiction B levies a flat 7 percent tax on the...Ch. 2 - Jurisdiction X levies a flat 14 percent tax on...Ch. 2 - Prob. 10APCh. 2 - Prob. 11APCh. 2 - Country A levies an individual income tax with the...Ch. 2 - Prob. 13APCh. 2 - Prob. 14APCh. 2 - Prob. 1IRPCh. 2 - Identify the tax issue or issues suggested by the...Ch. 2 - Prob. 3IRPCh. 2 - Prob. 4IRPCh. 2 - Prob. 5IRPCh. 2 - Prob. 6IRPCh. 2 - Prob. 1TPC
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