Cedar Corporation Is a Calendar Year Taxpayer Formed in 2010

question 96

Multiple Choice

Cedar Corporation is a calendar year taxpayer formed in 2010. Cedar's E & P for each of the past 5 years is listed below. Cedar Corporation made the following distributions in the previous 5 years.
2013 Land (basis of $70,000, fair market value of $80,000)
2010 $20,000 cash
Cedar's accumulated E & P as of January 1, 2015 is:

• A) $91,000.
• B) $95,000.
• C) $101,000.
• D) $105,000.
• E) None of the above.

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Definitions:

Direct Labor

The wages or expenses directly associated with the manufacturing of products or delivery of services.

Continuous Process

A production process that is non-stop and operates continuously over long periods.

Applied Factory Overhead

The portion of overhead costs that are allocated to produced goods based on a predetermined rate or method.

Direct Materials

Raw materials that can be directly attributed to the production of goods, considered a variable cost in manufacturing.