1. For a sole proprietorship engaged in the sale of unlawful controlled substances, the appropriate principal business activity code for Schedule C is:
(a) 325410 Pharmaceutical & medicine mfg.
(b) 325900 Other chemical product & preparation mfg.
(c) 713900 Other amusement and recreation services
(including golf courses, skiing facilities, marinas, fitness centers, bowling centers, skating rinks, miniature golf courses)
(d) 454390 Other direct selling establishments
(including door-to-door retailing, frozen food providers, party plan merchandisers, and coffee-break service providers)
2. Payments made to an assassin during the acquisition of another salesperson’s territory should be reported as an expense on:
(a) line 10, Commissions and fees
(b) line 17, Legal and professional services
(c) line 11, Contract labor
(d) None of the above; the acquisition cost must be capitalized.
3. The forfeiture of a bail bond is an ordinary and necessary business expense.
(a) True
(b) False
4. The formation of a limited liability company will shield the taxpayer from criminal liability arising out of the operation of the business.
(a) True
(b) False
5. Proceeds from the sale of marijuana cultivated by the taxpayer are reported on:
(a) Schedule F
(b) Schedule C
(c) Schedule D
(d) Schedule THC
(a) 325410 Pharmaceutical & medicine mfg.
(b) 325900 Other chemical product & preparation mfg.
(c) 713900 Other amusement and recreation services
(including golf courses, skiing facilities, marinas, fitness centers, bowling centers, skating rinks, miniature golf courses)
(d) 454390 Other direct selling establishments
(including door-to-door retailing, frozen food providers, party plan merchandisers, and coffee-break service providers)
2. Payments made to an assassin during the acquisition of another salesperson’s territory should be reported as an expense on:
(a) line 10, Commissions and fees
(b) line 17, Legal and professional services
(c) line 11, Contract labor
(d) None of the above; the acquisition cost must be capitalized.
3. The forfeiture of a bail bond is an ordinary and necessary business expense.
(a) True
(b) False
4. The formation of a limited liability company will shield the taxpayer from criminal liability arising out of the operation of the business.
(a) True
(b) False
5. Proceeds from the sale of marijuana cultivated by the taxpayer are reported on:
(a) Schedule F
(b) Schedule C
(c) Schedule D
(d) Schedule THC
Comment