When Researching a Complex Tax Question, a Researcher with Little

question 38

Multiple Choice

When researching a complex tax question, a researcher with little previous experience with the issue would be best served at the outset by consulting

• A)The Internal Revenue Code
• B)The Treasury Regulations
• C)The applicable legislative history
• D)A "tax service" (e.g., CCH, RIA)

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Definitions:

Contingent Liability

A potential obligation that may arise from a past event, the outcome of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events.

Financial Statements

Reports that provide an overview of a company's financial condition, including balance sheet, income statement, and cash flow statement.

Accounts Payable Turnover Ratio

A financial metric that measures how quickly a business pays off its suppliers by comparing net credit purchases to average accounts payable.

Inventory

The total amount of goods and materials held by a company for sale in the ordinary course of business.