Schedule M-1 of Form 1120 Is Used to Reconcile Financial

question 54

Multiple Choice

Schedule M-1 of Form 1120 is used to reconcile financial net income with taxable income reported on the corporation's income tax return as follows: net income per books + additions - subtractions = taxable income. Which of the following items is a subtraction on Schedule M-1?

• A) Book depreciation in excess of tax depreciation.
• B) Excess of capital losses over capital gains.
• C) Proceeds on key employee life insurance.
• D) Income subject to tax but not recorded on the books.
• E) None of the above.

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Definitions:

Abstract Thinking

The capability to understand concepts that are real or tangible without relying on specific examples or experiences.

Interrupt

To break the continuity or uniformity of a process or conversation, often abruptly or without prior notice.

Experimenter

A researcher who conducts experiments, often in a laboratory setting, to test hypotheses and observe effects in controlled conditions.

Gain-framed Appeal

Messages that emphasize the benefits of engaging in a certain behavior or taking a specific action.