Powell Inc

question 98

Multiple Choice

Powell Inc.was incorporated and began operations on October 1 and adopted a calendar year for tax purposes.Powell paid $4,200 to the attorney who handled the corporate formation.Which of the following statements is true?

• A)If Powell capitalized the $4,200 payment for financial statement purposes,it must also capitalize it for tax purposes.
• B)Powell can deduct the $4,200 payment on its first tax return.
• C)For tax purposes,Powell must capitalize the $4,200 organizational cost and amortize it over 15 years.
• D)None of the above is true.

Discriminate between the roles and functions of management accountants in organizations.

Evaluate external business offers considering capacity, incremental costs, and potential strategic implications.

Understand the effects of government licensing and monopoly power on market efficiency and consumer choice.

Recognize the challenges regulators face due to lack of information when imposing price regulation on monopolies.

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Definitions:

Mail Fraud Statute

refers to a law that provides federal jurisdiction for cases involving fraudulent activities that utilize the postal system as a means to commit the fraud.

Corporate Liability

The legal obligation of a corporation to pay for damages, fines, or penalties arising from its actions or those of its employees.

Sixth Amendment

An amendment to the U.S. Constitution that guarantees rights to a fair and speedy trial, the right to a lawyer, and the right to an impartial jury.

Speedy Trial

A legal right guaranteeing individuals accused of crimes to be tried promptly, aimed at preventing undue and lengthy pretrial incarceration.