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Topic: QUESTION OF THE DAY - MCQ’S ALL SECTIONS (

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grcenpcpa
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Posted: 11 Jan 2011 at 01:10 \| IP Logged

c

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AndrewCPA
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Posted: 11 Jan 2011 at 14:13 \| IP Logged

Correct Answer: A

Explanation: The base amount to determine the contribution limit is taxable income, without regard to the charitable contribution itself and the dividends received deduction. In this problem the DRD has not yet been computed and does not need to be. However, the dividends of $2,000 are not included in the operating income, and must be added in.

Operating income: $160,000
Add: dividend income: $2,000
Add: contributions: $10,000

Base amount: $172,000

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AndrewCPA
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Posted: 12 Jan 2011 at 20:08 \| IP Logged

Today’s question: BEC

If the United States has full employment and the dollar dramatically depreciates in value, we can expect (other things equal):

A) Both U.S. imports and U.S. exports to rise.

B) Both U.S. imports and U.S. exports to fall.

C) U.S. exports to fall and U.S. imports to increase.

D) Inflation to occur.

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Skooby
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Posted: 13 Jan 2011 at 08:11 \| IP Logged

AndrewCPA
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Posted: 13 Jan 2011 at 12:25 \| IP Logged

Correct Answer: D

Explanation: The depreciation of the dollar will tend to increase exports and when there is full employment, there will be a tendency toward inflation. A change in the value of the dollar is not likely to simultaneously increase both imports and exports. If the dollar depreciates in value, U. S. exports will rise. U. S. imports will decline and U. S. exports will increase.

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