Frederick Failed to File His 2015 Tax Return on a Timely

question 15

Essay

Frederick failed to file his 2015 tax return on a timely basis. In fact, he filed his 2015 income tax return on October 31, 2016, (the due date was April 15, 2015) and paid the amount due at that time. He failed to make timely extensions. Below are amounts from his 2015 return: Frederick sent a check for $1,671 in payment of his liability. He thinks that he has met all of his financial obligations to the government for 2015. For what additional amounts may Frederick be liable assuming any applicable interest rate is 6%?

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Definitions:

Time Period Assumption

An accounting principle that the life of a business can be divided into discrete time periods, such as months and years, for reporting purposes.

Operating Cycle

The duration of time it takes for a company to purchase inventory, sell the goods, and collect cash from the sale.

Dividends Declared

A firm's announcement of the payment of a dividend to shareholders by a specified date, representing a commitment to distribute a portion of earnings.

Net Income

The net income of a company, calculated by removing all costs and taxes from the total sales.