Understated Definition & Meaning
This allows a credit for 20 percent of qualified tuition and fees paid by the taxpayer with respect to one or more students for any year that the HOPE SHCOLARSHIP CREDIT is not claimed. Conveyance of land, buildings, equipment or other ASSETS from one person (LESSOR) to another (LESSEE) for a specific period of time for monetary or other consideration, usually in the form of rent. To put money into something such as property, stocks, or a business, 25 best accounting firms for 2023 in order to earn INTEREST or make a profit. Circumstance where loans in excess of ACCOUNTS RECEIVABLE are made against inventory in anticipation of future sales. Process designed to provide reasonable assurance regarding achievement of various management objectives such as the reliability of financial reports. A procedure that consists of seeking information, both financial and non financial, of knowledgeable persons throughout the company.
(2) May cause the loss of tax deductions under Section 162 (m), the deduction that public companies take for compensation to chief executive officer and next four highest compensated officers is limited to $1 million each. However, discounted options do not qualify as performance based compensation and therefore the deduction that the company would get may be partially or completely lost. In addition discounted stock options do not qualify for Incentive Stock option (ISO) treatment.
Listed Property
It must also be filed within the timeframe allotted or the refund may be lost. An individual can claim a refund back to whatever year it was due but it will only be paid three years back or less. Expenditure identified with goods or services acquired and measured by the amount of cash paid or the market value of other property, CAPITAL STOCK, or services surrendered. Expenditures that are written off during two or more accounting periods. Portion of the total GAIN recognized on the sale or exchange of a noninventory asset which is not taxed as ORDINARY INCOME. Capital gains have historically been taxed at a lower rate than ordinary income.
Charge made by a local government for the cost of an improvement or service. The temporary INVESTMENT of excess CASH, intended to be held until needed to pay current OBLIGATIONS. The number of shares in a COMPANY that have been issued and remain in circulation. A business that is treated as distinct from its creditors, customers, and owners. U.S. government BOND issued in face value denominations ranging from $50 to $10,000.
- DEFINED CONTRIBUTION PLAN characterized by the setting aside of a portion of an entity’s profits in participant’s accounts.
- The U.S. Tax Court is a legislative court functioning to adjudicate controversies between taxpayers and the IRS arising out of deficiencies assessed by the IRS for INCOME, GIFT, ESTATE, windfall profit and certain EXCISE TAXES.
- Another account will also have an error, due to the requirements for double-entry accounting.
- Legal process, governed by federal statute, whereby the DEBTS of an insolvent person are liquidated after being satisfied to the greatest extent possible by the DEBTOR’S ASSETS.
- Any citizen that is not a resident or citizen of the United States.
Ection, i., if
❖There are exceptions to this rule and we will see that soon. ZERO-COUPON BOND convertible into the COMMON STOCKof the issuing COMPANY when the stock reaches a predetermined price. Rate of spending, or turnover of money- in other words, how many times a dollar is spent in a given period of time. Total costs that change in direct proportion to changes in productive output or any other measure of volume.
Bank Statement
These are a set of rules intended to be a single comprehensive set of rules to govern the capitalization, or inclusion in INVENTORY of direct and indirect cost of producing, acquiring and holding property. Under the rules, taxpayers are required to capitalize the direct costs and an allocable portion of the indirect costs attributable to real and tangible personal property produced or acquired for resale. The obvious effect of the uniform capitalization rules is that taxpayers may not take current deductions for these costs but instead must be recovered through DEPRECIATION or AMORTIZATION.
Factory Overhead Costs
Percentage of the selling price of the property, paid by the seller. To clear the BALANCES of temporary accounts in order to be ready for the next accounting period. ACCOUNTANT who has satisfied the education, experience, and examination requirements of his or her jurisdiction necessary to be certified as a public accountant. A multicolumn journal used to record sums of cash paid out for expenses. Net of cash receipts and cash disbursements relating to a particular activity during a specified accounting period.
Misstating Assets and Liabilities
Acquisition of a controlling INTEREST in a company in a transaction financed by the issuance of DEBT instruments by the acquired entity. Person or entity that has the right to use property under the terms of a LEASE. A complete record of the transactions recorded in each individual account. Any book of accounts containing the summaries of debit and credit entries.
Unlike a CORPORATION’S shareholders, the partnership’s general partners are liable for the DEBTS of the partnership. The residual INTEREST in the assets of a business entity that remains after deducting the entity’s liabilities. A CHECK that has been written by the drawer and deducted on his or her records but has not reached the bank for payment and is not deducted from the bank BALANCE by the time the bank issues its statement.
Ordinarily, «cost» is the purchase price of the asset and «market» refers to its current replacement cost. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) requires that certain assets (e.g., INVENTORIES) be carried at the lower of cost or market. Under the PURCHASE METHOD OF ACCOUNTING, one entity is deemed to acquire another and there is a new basis of accounting for the ASSETS and LIABILITIES of the acquired company. In a POOLING OF INTERESTS, two entities merge through an exchange of COMMON STOCK and there is no change in the CARRYING VALUE of the assets or liabilities. After a taxpayer’s basis in property is determined, it must be adjusted upward to include any additions of capital to the property and reduced by any returns of capital to the taxpayer. Additions might include improvements to the property and subtractions may include depreciation or depletion.
Weighted-Average-Cost Method
Comparison of two numbers to demonstrate the basis for the difference between them. An entity that holds a fixed pool of mortgages and issues multiple classes of interests in itself to investors. A qualified REMIC is generally taxed like a partnership, unless it takes contributions after its start up day or engages in a prohibited transaction. The amount of PROFIT or INTEREST earned on an INVESTMENT, usually expressed as a percentage, such as an interest; the COST OF CAPITAL; the cost of money.
Certain taxpayers may not be entitled to use the standard deduction. If one taxpayer itemizes then the other is required to by law even if the married filing separate taxpayer is unknowing of what is included on the spouses separate return. A reason for this might be the prevention of pooling and duplication of deductions. The costs of organizing a trade or business or for profit activity before it begins active business. A taxpayer may elect to amortize such expenses for a tern no less than 60 months. If the election is not made then the expenses are not deductible and may only be recovered when the business ceases operation or is sold.
In a public offering of new SECURITIES, price at which investment bankers in the underwriting syndicate agree to sell the issue to the public. Taxpayers meeting statutory requirements MUST file various returns on the prescribed forms. And they must be filed timely or the y may not be considered as filed. Federal law enacted in 1971 giving persons the right to see their credit records at credit reporting bureaus. Time granted by a taxing authority, such as the INTERNAL REVENUE SERVICE (IRS), a state or city, which allows the taxpayer to file tax returns later than the original due date.
Development is the translation of research findings into a plan or design of new or improved products and services. Method of ACCOUNTING in which the values that arise from an acquisition are transferred or «pushed down» to the accounts of an acquired company. A CONTRA ACCOUNT used under the PERIODIC INVENTORY SYSTEM to accumulate CASH refunds, credits on ACCOUNT, and other allowances made by suppliers for unsatisfactory or incorrect MERCHANDISE that was originally purchased for resale. Major part of the registration statement filed with the SECURITIES AND EXCHANGE COMMISSION (SEC) for PUBLIC OFFERINGS. A prospectus generally describes SECURITIES or partnership interests to be issued and sold.
