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Certified Public Accountant CPA Regulation (CPA-Regulation) - AICPA Exam Questions

Last updated on June 20, 2026

97% Exam Compliance
69 Total Questions
1
Question
Tom and Joan Moore, both CPAs, filed a joint 1994 federal income tax return showing $70,000 in
taxable income. During 1994, Tom’s daughter Laura, age 16, resided with Tom. Laura had no income of her own and was Tom’s dependent. Determine the amount of income or loss, if any that should be included on page one of the Moores’ 1994 Form 1040.
The Moores received a $500 security deposit on their rental property in 1994. They are required to
return the amount to the tenant.
Options
A $1,250
B $1,000
C $1,300
G. $1,500
H. $2,000
I. $2,500
J. $3,000
K. $10,000
L. $25,000
M. $50,000
N. $55,000
O. $75,000
D $500
E $900
F $0
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2
Question
On December 1, 1997, Krest, a self-employed cash basis taxpayer, borrowed $200,000 to use in her
business. The loan was to be repaid on November 30, 1998. Krest paid the entire interest amount of
$24,000 on December 1, 1997. What amount of interest was deductible on Krest's 1997 income tax
return?
Options
A $24,000
B $2,000
C $22,000
D $0
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3
Question
Allen owns 100 shares of Prime Corp., a publicly-traded company, which Allen purchased on January
1, 2001, for $10,000. On January 1, 2003, Prime declared a 2-for-1 stock split when the fair market
value (FMV) of the stock was $120 per share. Immediately following the split, the FMV of Prime stock
was $62 per share. On February 1, 2003, Allen had his broker specifically sell the 100 shares of Prime
stock received in the split when the FMV of the stock was $65 per share. What amount should Allen
recognize as long-term capital gain income on his Form 1040, U.S. Individual Income Tax Return, for 2003?
Options
A $2,000
B $750
C $1,500
D $300
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4
Question
On February 1, 1993, Hall learned that he was bequeathed 500 shares of common stock under his
father's will. Hall's father had paid $2,500 for the stock in 1990. Fair market value of the stock on
February 1, 1993, the date of his father's death, was $4,000 and had increased to $5,500 six months
later. The executor of the estate elected the alternate valuation date for estate tax purposes. Hall
sold the stock for $4,500 on June 1, 1993, the date that the executor distributed the stock to him.

How much income should Hall include in his 1993 individual income tax return for the inheritance of the 500 shares of stock, which he received from his father's estate?
Options
A $0
B $4,000
C $2,500
D $5,500
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5
Question
Smith, an individual calendar-year taxpayer, purchased 100 shares of Core Co. common stock for
$15,000 on December 15, 1992, and an additional 100 shares for $13,000 on December 30, 1992. On
January 3, 1993, Smith sold the shares purchased on December 15, 1992, for $13,000. What amount
of loss from the sale of Core's stock is deductible on Smith's 1992 and 1993 income tax returns?

Exhibit
Options
A Option D
B Option B
C Option C
D Option A
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