Which of the following activities is least likely to be excluded from the definition of unrelated...
Question:
Which of the following activities is least likely to be excluded from the definition of unrelated trade or business?
a. A trade or business in which substantially all the work is performed for the organization without compensation
b. A bingo game that is legal where it is played (and played in a jurisdiction where bingo games are not regularly carried on by for-profits)
c. Payments for advertising that strongly endorses sponsor's products
d. A trade or business carried on by a university primarily for the convenience of its students
Unrelated trade or business:
"Unrelated trade or business" is an activity that is not related to the performance or function done as a charity, for educational purposes or any other purpose lead to getting the exemptions. Rental income, research income, income from royalties, or gain or loss on the sale of property are the examples excluded from the unrelated business taxable income.
Answer and Explanation: 1
Become a Study.com member to unlock this answer! Create your account
View this answerCorrect answer:
Option (c) Payments for advertising that strongly endorses the sponsor's products is the correct answer because this element is...
See full answer below.
Ask a question
Our experts can answer your tough homework and study questions.
Ask a question Ask a questionSearch Answers
Learn more about this topic:
Get access to this video and our entire Q&A library
Service & Trading Businesses: Definitions & Examples
from
Chapter 4 / Lesson 1
77K
Trade and service businesses differ by selling goods and inventory versus selling experiences and intangible goods. Explore how trade businesses and service businesses differ through examples of each.
Related to this Question
- What activities are unique to merchandise businesses? How does management account for the additional task unique to a merchandise operations? What are some of the things that can happen if a company don't keep a track of the merchandise?
- Which of the following is not an activity specifically listed in the text as prohibited by the Sarbanes Oaxley Act for an auditor of a company to perform contemporaneously? A. Appraisal or valuation services B. Actuarial services C. Income tax preparat
- 1. From the e-Activity, discuss one violation of the AICPA Code of Professional Conduct leading to disciplinary action. Explore the risks that relationships or circumstances played in the failure of t
- For questions 7 to 17, identify each of the following as (a) an operating activity, (b) a financing activity, (c) an investing activity, or (d) none of these. Use the blanks provided on the right. 7.
- For each of the 5 business processes listed below: Indicate which of the business events listed are activities within that business process (please use letters rather than descriptions of business eve
- Which of the following is correct? a) All related party transactions are inherently risky even if disclosed. b) All related party transactions are illegal. c) All related party transactions are legal. d) All related party transactions are a sensible busin
- Which of the following is not a broad category of incompetent and disreputable conduct subject to sanctions under Circular 230? a. misconduct related to the practitioner's own return b. misconduct while performing professional duties c. misconduct while a
- Which of the following would cause you the most concern about accepting an engagement? (a) The existence of related party transactions (b) Excessive turnover in the accounting department (c) A large percentage of the potential client's income is generated
- A term describing a firm's normal range of operating activities is: a) Relevant range of operations. b) Break-even level of operations. c) Margin of safety of operations. d) Relevant operating analysis. e) High-low level of operations.
- What is the conflict of interest in terms of accounting firms offering consulting services to businesses as well as external auditing services? What law prevented this? What accounting fraud case triggered this law to be drafted and implemented?
- The best definition of a scienter is: a. A causal connection between a misstatement and a material loss b. A material omission of facts c. None of these choices is correct. d. Fraudulent conduct in the purchase of a security e. A wrongful state of mind wh
- a) Identify the steps of the accounting cycle and provide a description of each step. b) Analyze the role each step plays in the success of a business. c) Analyze how the omission of a step could im
- a. What is conflict of interest in terms of Accounting Firms offering consulting services to businesses as well as external auditing services? b. What law prevented this? c. What accounting fraud triggered this law to be drafted and implemented?
- In the segregation of accounting duties, list the three functions which should be kept separate. Provide an example of an activity or task within each function.
- Which of the following is the normal type of audit for an individual taxpayer who conducts significant business activities? a. Office audit. b. Telephone audit. c. Correspondence audit. d. Field audit. e. None are correct.
- 1. What would result if one company recorded the appropriate transactions from an intercompany transaction but the other company did not? 2. What ethical concerns present themselves if this was an ongoing issue?
- Describe the key elements of the internal revenue code that a taxpayer should be aware of when structuring corporate ownership and engaging in intercompany activities.
- Accountants do all of the following except: a. measure business activities. b. summarize business activities. c. interpret financial information. d. locate capital.
- When one party to a transaction has incentives to engage in activities detrimental to the other party, there exists a problem of: A) moral hazard. B) split incentives. C) ex-ante shirking. D) pre-contractual opportunism.
- A business process is a set of coordinated activities and tasks that _____. a. create secure systems b. constitute a transaction cycle c. accomplish some organizational goal d. None of the above
- Which of the following would not require a normalization entry? a. excess owner's compensation b. an extraordinary item c. the selling of a discontinued business segment d. an arm's length relative party transaction
- Which one of the following activities best exemplify working capital management? For this exercise, you will be choosing more than one option for your answer: - Identify three good investment opportunities for the firm. - Obtain a short-term loan to purc
- a) Identify the steps of the accounting cycle and provide a description of each step. b) What role does each step play in the success of a business? c) How could the omission of a step impact the success of a business? What strategies could be used to avo
- Which of the following is, or are, commonly accepted definitions of CSR? a. A corporation fully complies with all applicable laws and regulations. b. A corporation engages in activities that are both socially responsible and profit-enhancing. c. A corpora
- The principal-agent problem that exists for bank trading activities can be reduced through: A) creation of internal controls that combine trading activities with bookkeeping. B) creation of internal controls that separate trading activities from bookkee
- Which action is not considered an act discreditable to the accounting profession? a) Being finally determined by a court of competent jurisdiction to have violated any of the federal antidiscrimination laws. b) Having a bank collect notes received from a
- Which of the following is, or are, commonly accepted definitions of CSR? a. A corporation fully complies with all applicable laws and regulations. b. A corporation engages in activities that are socially responsible, even if they are not profit-enhancing.
- Which of the following is not an example of white-collar crime, broadly defined? a. a physician defrauding Medicaid b. a corporation that knowingly markets defective automobiles c. a lawyer who commits a hold-up at a bank d. a bank clerk who embezzled mon
- Which of the following professional standards applies to not engaging in any activity that would discredit the profession? a. Integrity. b. Credibility. c. Confidentiality. d. Competence.
- Match the following terms in the left column with the appropriate definition from the right column. 1. Goodwill _____ a. The ability of a business to generate income in excess of a normal rate on ass
- Identify which control activity is violated in each of the following situations, and explain how the situation creates an opportunity for fraud or inappropriate accounting practices. 1. Once a month, the sales department sends sales invoices to the accoun
- Which of the following would not be included in the definition of inventory under IFRS? (a) Photocopy paper held for sale by an office supply store. (b) Stereo equipment held for sale by an electronics store. (c) Used office equipment held for sale by
- Identify some of Enron's conflict of interest, within: SPE activities Arthur Andersen's activities Executives activities
- Which of the following activities is not an accounting function? a. auditing b. management consultancy c. costing d. taxation
- Which of the following is not an example of a common ethical decision-making pitfall? a. Conforming to an unethical corporate culture b. Focusing only on legalities c. Conflicts of interests d. Failure to identify all stakeholder groups e. None of th
- For the following activity, explain which of the objectives of managerial accounting activity is/are involved: Comparing a room rate structure, occupancy rate and restaurant patronage with industry averages.
- The definition of discontinued operations is contained in the FASB ASC. Find this definition, cite the paragraph, and copy it.
- Which of the following qualities are characteristic of fixed assets? a) Tangible b) Capable of repeated use in the operations of the business c) Held for sale in the normal course of business d) Used rarely in the operations of the business, e) Long-lived
- A basic assumption of accounting that requires activities of an entity be kept separate from the activities of its owner is referred to as the: a) stand-alone concept. b) monetary unit assumption. c) economic entity assumption. d) fair share principle.
- Accounting Cycle a) Identify the steps of the accounting cycle and provide a description of each step. b) Analyze the role each step plays in the success of a business. c) Analyze how the omission of
- Describe your current or aspiring professional identity, including your career and the field in which you work or hope to work. What sort of transactions would you encounter in that field? What are the impacts of those transactions on the business? List a
- Which of the following parts of the AICPA Code of Professional Conduct is enforceable? A. Ethical Rulings. B. Interpretations of the rules of conduct. C. Principles. D. Rules of conduct.
- Which of the following factors are relevant to the assessment of the risks of material misstatement associated with a particular location or business unit? a. The existence of related party transactions. b. Management's attempt to meet earnings per shar
- Which is an example of asset misappropriation? a. A disgruntled employee sprays paint on company trucks. b. An accountant refuses to pay another company for supplies. c. A vendor overcharges for a contracting job. d. An employee takes supplies from a con
- Ethical behavior at work is learned by? A. Attending corporate responsibility seminars. B. Tracking the failures of those who are caught in business scandals. C. Reading about why others were fired from the job. D. Observing the actions of others.
- Separation of duties refers to separating all of these functions except which of the following? A. Keeping accounting records B. Authorizing transactions C. Maintaining custody of assets D. Hiring personnel
- are the regular, predictable, and sequential patterns of work activities performed by organizational members. A. Organizational capabilities B. Accumulated knowledge C. Actual work activities D. Organizational routines and processes
- Identify which control activity is violated in each of the following situations, and explain how the situation creates an opportunity for fraud or inappropriate accounting practices. 1. Once a month,
- What is a purpose of having a conceptual framework? a. To make sure that economic activity can be identified with a particular legal entity. b. To segregate activities among different companies. c. To provide comparable information for different companies
- Letting no single employee be responsible for authorizing transactions, handling assets, and keeping accounting records is called: a. control environment b. segregation of duties c. risk assessment d. control activities e. none of the above
- Discuss ways in which activity-based accounting and activity-based management could help the company you selected gain a competitive advantage in the marketplace.
- Identify a business that you are familiar with or have dealt with in the past (hospital, library, coffee or fast food shop, etc.) and comment on two activities that you have observed that, in your opinion, are non-value-added. What recommendations would y
- Which type of organization would most likely have work in process inventory? (a) A retail store (b) A manufacturing company (c) A service organization (d) A real-estate investment trust.
- Think of an organization you currently work in or have worked for (or one you want to work for). What elements were present that encouraged a dishonest employee to commit fraud? Try to use the fraud t
- The term used to describe the ways of thinking, acting, and understanding work shared by members of an organization and reflects an organization's distinct identity is called a. organizational culture. b. organizational hierarchy. c. organizational rit
- Discuss ways in which activity-based accounting and activity-based management could help companies gain a competitive advantage in the marketplace.
- a. What are the hallmarks of a good business code of conduct? b. What is a conflict of interest? c. It is the same as self-dealing?
- Identify the term being defined or described by the following statement: The branch of accounting that is concerned with the recording of transactions using generally accepted accounting principles for a business or other economic unit and with a periodic
- The steps in the accounting cycle are listed in random order below. List the steps in proper sequence, assuming no worksheet is prepared, by placing numbers 1-9 in the blank spaces. A. Analyze busines
- Assume that a highly placed employee has stolen company assets and is now planning to conceal the fraud by failing to make an accounting entry for a large transaction. Would the omission probably be a transaction creating an asset or a liability?
- Assume that a highly placed employee has stolen company assets and is now planning to conceal the fraud by failing to make an accounting entry for a large transaction. Would the omission probably be a transaction creating an asset or a liability? Explain.
- We describe charitable donations by corporations to nonprofit organizations as __________. A. corporate philanthropy B. corporate responsibility C. corporate strategy D. structural commitment
- Cooper and Kaplan developed the framework used to classify manufacturing activities. List the four categories of activities and provide two examples of each activity level. Use the tables below to sub
- a) Differentiate between investing activities, operating activities and financing activities. Provide examples of each. b) Explain the difference between a vertical analysis and a horizontal analysis
- Which of the following activities most likely would be considered a weakness in an entity's internal control over payroll? a) A voucher for the amount of the payroll is prepared in the general accounting department based on the payroll departments payroll
- Which of the following is not an example of a nontaxable like-kind exchange? a - Land for an office building. b - A printer for a computer. c - Inventory for a locomotive. d - The trade of an apartment building for a store building.
- Act ethically, and comply with all statutory requirements, professional codes of practice, and fiduciary obligations. What does this mean to you and your organization?
- Identify ethical issues, conflicts of interest, and noncompliance with corporate policies and procedures in the Enron case.
- Sin City Entertainment owns a number of casinos in Las Vegas and has decided to expand to Atlantic City. Prepare the entries to report the following activity, and show how this activity changes Sin Ci
- In which of the following unrelated exchanges is the Sec. 351 control requirement met? If the transaction does not meet the Sec. 351 requirements, suggest ways in which the transaction can be structu
- Identify the applicable accounting convention for the following business scenarios. Explain your choice. \\ Bozrah Industries, a small independent retailer, wants to change its accounting system from cash-based to accrual-based, and is concerned about how
- Which of the following could not be considered a business segment? A) Region B) Product C) Customer Type D) All of these could be considered business segments.
- Define the following terms: Alternative dispute resolution Arbitration Mediation Scheme Statutory interest (LO 5)
- Distinguish between ordinary negligence and gross negligence within the context of a CPA's work.
- Which of the following conditions or events most likely would cause an auditor to have substantial doubt about an entity's ability to continue as a going concern? a. Significant related party transactions are pervasive. b. Unusual trade credit from suppli
- Determine whether the following event of a firm is under financing activity, investing activity, or operating activity: Tighten its credit policy with its customers.
- Which of the following is most likely true about speculative transactions and forecasted transactions? A. Forecasted transactions are less risky than speculative transactions because forecasted transactions are based on the historical pattern of purchase
- Protected __________ activities include filing a charge, testifying, assisting, or participating in any manner in an investigation, proceeding, or hearing. A. discrimination B. protest C. participation D. legal
- According to the profession's ethical standards, which of the following events may justify a departure from GAAP? \\ I. New legislation. II. Conflicting industry practices. III. Evolution of a new form of business transaction.
- Which of the following criteria must be met before an event should be recorded for accounting purposes? a) The event must be an arm's-length transaction. b) The event must be repeatable in a future period. c) The event must be measurable in financial term
- Which of the following transactions would result in the change in Inventory on the SCF being a different number than the change in Inventory on the balance sheet? (Select all that apply.) 1. Some of the inventory was stolen by employees. 2. Some of the in
- Discuss the role honesty plays in business? What are the consequences of unethical business practices and behavior?
- Demonstrate your ability to explain the objective of financial reporting and to apply the definitions of financial statement elements to identify events and transactions that businesses recognize in t
- Which of the following is an example of a trading bloc? A) World Bank B) European Union C) International Monetary Fund D) World Trade Organization E) United Nations
- Which of the following terms is NOT defined by statute in the Companies Act of the United Kingdom? a. Accountant b. Auditor c. Independence d. None of the above terms is defined in the Companies Act of the UK.
- Which of the following phrases is used by the Code of Professional Conduct to describe integrity? A. Candid, within the constraints of client confidentiality. B. Forceful advocate of the client's position. C. Valued business advisor to the client. D. Will
- Which of these activities is not part of market situation analysis? A. Deciding new product opportunities. B. Collecting information on the electronic items market. C. Analyzing purchase patterns of people visiting a store. D. Researching on why the co
- Identify which function of the management of an organization is being described by the following statement: Involves coordinating the diverse activities and human resources of a company to produce a smooth-running operation. This function relates to the i
- Which of the following is an example of a typical exempt salaried employee? a. Operations Manager. b. Accounting Clerk. c. Machine Operator. d. Administrative Assistant.
- Which of the following is the most common type of audit for an individual taxpayer who conducts no significant business activities? A. Office audit. B. Correspondence audit. C. Telephone audit. D. Field audit. E. Service center audit.
- Which of the following is not a typical component of a code of conduct? a. Fair employment practices. b. Salary scales. c. Conflicts of interest. d. Privacy.
- The general manager of a business encounters many different types of business transactions. Provide an example of a transaction that would describe the effect on the accounting equation. Each situatio
- Business rules implement internal controls. Describe which business rules implement segregation of duties. classify each of choose business rules as obligatory, prohibited or allowed.
- Identify which control activity is violated in each of the following situations. 1.Once a month, the sales department sends sales invoices to the accounting department to be recorded. Documentation pr
- 1. Compare and contrast being an employee and an independent contractor. Which one would you rather have as a business owner? Which one would you rather be as a worker? Why? 2. What is the passive activity loss limitation? Are rental activities passive a
- Which of the following are considered to be legal entities that exist separate and distinct from their owners? A. Sole proprietorships B. Organizations with more than 100 partners C. Corporations D. Partnerships
- Which of the following statements is accurate regarding the definition of terms in the Internal Revenue Code? a. All definitions contained in the code are included in Code Section 7701. b. Definitions must be included whining the code section to which the
- How do the concepts of cognitive dissonance and organizational/ethical dissonance relate to whether an accountant might choose to blow the whistle on corporate wrongdoing?
- Choose the term that best fits each of the following definitions and descriptions. _____1. A note that is legally transferable by endorsement and delivery. _____2. Any receivable arising from transactions that are not directly associated with the normal
- Explain the appropriate field work needed to review high-risk business transactions for cash and revenue. 1. What would you need to do in the field to investigate these? 2. Could you convey this inf
Explore our homework questions and answers library
Browse
by subject