Question 1
Corporations have been scrutinized as to the recording and valuation of taxes they owe. The determination of how much they will pay is a combination income and expenses they report. There are many tax rules and regulations that are part of the IRS Tax code that apply to tax reporting of corporations. Please select a specific IRS tax code rule and present this to the class. In your presentation describe what is being measured, the intent of the rule and how the rule came to be.
Respond to this...I located US Code Title 26, subtitle A, Chapter 1, Subchaper A Part II, Tax on Corporations - Tax imposed.(https://www.law.cornell.edu/uscode/text/26/11 )
The code starts out simple, "A tax is herby imposed for each taxable year on the taxable income of every corporation". The next part discusses the amount of taxes imposed. Part C lines the Exceptions. Most of these exceptions are related to corporations conducting business in life insurance, insurance and investment companies and trusts. The final section, d, relates to foreign corporations. However to know more about this area it is suggested that one res section 55 and section 882.
I think that the intent of this rule is simple, to note that corporations need to pay taxes and the amount of which should be paid, 15 percent of the taxable income as does not exceed $50,000, 25 percent of the taxable income over $50,000 but not above $75,000 and so on.
Question 2
Conduct Internet research to locate information on interim financial reporting. Locate information on the reporting of accrual and deferrals.
For interim financial reporting for domestic subsidiaries, what categories may be accrued or deferred to provide an appropriate use of the basic matching concept accounting for costs in each period? Why is this important to the stakeholders? Are these different than year-end reporting? In your opinion, do you feel interim reports are valid and can be considered reliable?
Respond to this...Categories that may be accrued or deferred:
The categories that may be accrued may vary within reporting periods. An account may be recorded entirely within one reporting period, or its recognition may be spread across multiple periods (What are Interim Financial Statements, n.d.).
Why important to stakeholders:
The interim statements provide updated and more current information on the businesses operations (What are Interim Financial Statements, n.d.).
Different from year-ending statements:
If the business wants the annual statements to add up to what was on the interim statements the requirements for the annual statements should be followed when creating the interim statements (What are Interim Financial Statements, n.d.). Unlike the annual statements, interim statements are not required to be audited (What are Interim Financial Statements, n.d.).
The interim statements can be very different from one period the business can have a period that generates more business over another. This may not be apparent on the annual statements (What are Interim Financial Statements, n.d.).
Can interim statements be reliable and valid:
There will always be a business out there that have employees or owners trying to cheat and steal money. For those businesses, the interim statements are not reliable and valid. The ones that are being honest are the ones that we can rely on. Yes, mistakes can happen; but they can also happen in the annual statements and are not always noticed.
What are Interim Financial Statements.(n.d.). Retrieved from Accounting Coach: https://www.accountingcoach.com/blog/what-are-interim-financial-statements
What are Interim Financial Statements.(n.d.). Retrieved from Accounting Tools: https://www.accountingtools.com/questions-and-answers/what-are-interim-financial-statements.html
Question 3
Many times, after the implementation of a new system, employees must be let go. More advanced systems take over the work that some employees may be manually completing and their services are no longer necessary. Assume that you are the manager in this type of situation. How do you address the employees that are to be let go? How do you address the rest of the staff?
Respond to this...Wow, I hope I never find myself in this situation. I think I would want to address the affected employees all at the same time and be direct about it, meaning start the meeting by explaining that I have some bad news. I say this because I was on the other side of this scenario a few years ago. The corporation I worked for was closing the location I worked at. I remember on a Monday morning seeing several "suits" in the office and thinking how unusual it was. They called everyone into the meeting room and delivered the news that as of closing time the next day (the last day of the month) our location would be closing permanently. The problem was that the person delivering the bad news thought it was a good idea to go over company performance and the struggles of the company before letting us all down. It was totally unnecessary in my opinion and just made it more painful. In this case, they offered to help us find jobs at other locations, but the closest was 8 hours away and not realistic. If there were people unaffected I would probably want to meet with them and tell them what was going on too, otherwise they will find out quickly and from people who are already upset.