Regarding the Rules Applicable to Filing of Income Tax Returns

question 56

Multiple Choice

Regarding the rules applicable to filing of income tax returns, which, if any, of the following is an incorrect statement:

• A)Married persons who file joint returns cannot later (after the due date of the return) substitute separate returns.
• B)Married persons who file separate returns can later (after the due date of the return) substitute a joint return.
• C)The usual test as to when a taxpayer must file a return is based on the total of the following: personal exemption + basic standard deduction + both additional standard deductions.
• D)Special filing requirement rules exist for taxpayers who are claimed as dependents of another.
• E)None of the above.

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Definitions:

Ending Inventory

The total value of a company's merchandise, raw materials, work-in-progress, and finished goods at the end of an accounting period.

Ceiling Constraint

In accounting, the maximum value that inventory can be reported at, ensuring that assets are not overstated.

Floor Constraint

A limitation in inventory accounting that prevents the value of inventory from being reported below a certain level.

Normal Profit Margin

The average amount by which a company's gross profits exceed its production costs, excluding any extraordinary items or windfalls.