Free AICPA AICPA-CPA Exam Questions

Sam rents his second home. During the current year, he reported a $40,000 net loss from the rental. Assume Sam actively participates in the rental activity and no phase-out limitations apply. What is the greatest amount of the rental loss that Sam can deduct against ordinary income in the current year?

The account that records expenses, gains and losses is

Brick Co. has considerable excess manufacturing capacity. A special order's cost sheet includes the following applied manufacturing overhead costs: fixed, $18,000; variable, $43,000. The fixed costs include a normal $3,600 allocation for in-house design costs although no in-house design will be done. Instead, the job will require the use of external designers costing $4,500. What is the total amount to be included in the calculation to determine the minimum acceptable price for the special order?

Sales on credit is recorded in which of the following journal ?

Prior to the financial year end of 31 July 20X9, Cannon Co has received a claim of $100,000 from a supplier for providing poor quality goods which have damaged the supplier’s plant and equipment. Cannon Co’s lawyers have stated that there is a 20% chance that Cannon will successfully defend the claim. Which of the following is the correct accounting treatment for the claim in the financial statements for the year ended 31 July 20X9?