10/19 Notes

Question 1

When goods are custom-made and not suitable for resale, the seller can sue for the entire contract price plus incidental damages, not merely reimbursement of costs.

Answer 1

Question 2

If you leave your property to a merchant, and the merchant sells it to another customer, you cant recover it from the customer, because it was a Merchant whom you entrusted the property too. (You can sue the merchant though)

Answer 2

Question 3

To avoid underpayment penalty
Pay the LESSER of

100% of PY tax liability (110% if PY AGI > 150k)
or
90% of CY tax liability

Answer 3

Question 4

Auto perfection in perchase money security interest only applies to CONSUMER Goods

Answer 4

Question 5

If an offer is accepted prior to the sellers death, a contract is formed, not terminated. BUT if the offeror dies before the offer is accepted, the offer is terminated.

Answer 5

Question 6

If prorating Realty taxes from calendar year, prorate from January 1 through the date property is sold

Answer 6

Question 7

The agent has the same actual authority regardless if the principal is disclosed or not. Apparent authority doesn’t matter if the third party doesn’t even know there’s a principal.

Answer 7

Question 8

The dissenting subsidiary must be remedied when a parent company who owns more than 90% of the subsidiary decides to merge with the subsidiary

Answer 8

Question 9

The express limitations placed on the agent’s authority that were unknown to the third party are what matter in the court case between a third party/agent/principle

Answer 9

Question 10

Dividends, interest, capital gains are domiciled. Everything else is where located/apportioned

Answer 10

Question 11

Self employed individuals can deduct:
- Health insurane premiums (medical expenses are itemized).
- 50% of self employment taxes
- and most contributions to Tradional IRA retirement plans (non roth)

Answer 11

Question 12

An agreement to not compete is ordinary income

Answer 12

Question 13

Incentives to key insiders can by no more than 10x the amount.

Here 10x is 350k, and all other options are above that

Answer 13

Question 14

• Understatement for unreasonable position = 1k
• Aiding/abeding an understatement = 1k,
• Willful attempt = 5k
• Willful delivery = 10k, 1 year prison
• Willfuly under perjury = 100k, 3 years
• Accuracy related unerpayment = 0 fine

Answer 14

Question 15

Schedule M-2 Sim

• Interest income, dividends, capital gains go together on other additions,
• tax exempt interest is seperate

Answer 15

Question 16

Schedule M-2 Sim
- Charitable deductions, investment interest expense, and 50% meals together in other reductions
- tax exempt expense seperate

Answer 16