ACC 456 STUDY Extraordinary Success/acc456study.com ACC 456 STUDY Extraordinary Success/acc456study. | Page 12

·
b.Why is it important to understand the concept of gross income
even though the term is not found on Form 1040?
2-4
List the conditions that must be met in order to claim a dependency
exemption for qualifying children and qualifying relatives. Briefly
explain each one.
3-11
Ricardo owns a small unincorporated business. His 15-year-old
daughter Jane works in the business on a part-time basis and was paid
wages of $3,000 during the current year. Who is taxed on the child’s
earnings: Jane or her father? Explain.
3-15
·
a.Explain the difference between the treatment of prepaid
income under the tax law and under financial accounting.
· b.Why are the two treatments so different?
· c.What problem does this treatment create for taxpayers?
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ACC 456 Week 3 Key Points
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