Match Each Statement with the Correct Choice

question 72

Multiple Choice

Match each statement with the correct choice. Some choices may be used more than once or not used at all.
-Surviving spouse disclaims inheritance in favor of bypass amount.

• A)Step-up in basis
• B)Step-down in basis
• C)Gift of installment notes receivable
• D)Gift of property that has potential for recapture of depreciation
• E)Donor's basis on date of gift appreciated property given, no gift tax due)
• F)The amount of the deceased spouse's taxable estate does not change
• G)Fair market value on date of gift
• H)Expected surviving spouse is in good health and 10 years younger
• I)No income tax consequences to the beneficiary
• J)Income in respect of a decedent IRD)
• K)No correct choice is given

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Definitions:

Direct Materials Cost

Direct materials cost refers to the cost of raw materials and components that are directly used in the production of a product, which are easily traceable to the finished product.

Equivalent Units

A concept used in cost accounting to express the amount of work done on in-process products in terms of complete units of output.

FIFO Method

An inventory costing method where the earliest items added to inventory are the first to be recorded as sold, affecting financial statements during inflationary periods.

Work in Process Inventory

The inventory account that tracks the cost of materials, labor, and overhead for products that are in production but not yet complete.