The tax base (it used to be tax basis, but somehow it changed to tax base; I think the reason is that the plural for each word is “bases” (pronounced <base-eez> and <base-ezz>, respectively), that someone mistook “bases” (plural of “basis”) to be “bases” (plural of “base”), and the error caught on) of an asset […]

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One of the reasons that Level I candidates find income taxes confusing is that the Income Tax Expense shown on a company’s income statement generally is not equal to the tax liability that is shown on their income tax return.  The fact that they are different from each other is a little easier to understand […]

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I debated for a long while whether to write a single article about taxes, or to write separate articles about each of the bits that go into taxes  I think that separate articles is the way to go.  So this is the general article that ties it all together, and provides definitions for all of […]

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A useful skill to develop is that of writing out a quick, simple, general cash flow statement.  Here is an example that you should be able to reproduce in 10 – 15 seconds during the exam: \begin{align}&\ \ \ \ \ \ Cash\ Flow\ from\ Operations\ (CFO)\\ &+\ Cash\ Flow\ from\ Investing\ (CFI)\\ &\underline{+\ \ […]

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A useful skill to develop is that of writing out a quick, simple, general balance sheet. Here is an example that you should be able to reproduce in 10 – 15 seconds during the exam: \begin{align}&Current\ Assets\\ &PP\&E\\ &\underline{Intangible\ Assets}\\ &=\ Total\ Assets\\ \\ &Current\ Liabilities\\ &\underline{\ Long-term\ Liabilities}\\ &=\ Total\ Liabilities\\ \\ &Capital\ Stock\\ […]

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