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avanturin [10]
3 years ago
9

Alexandra is a veterinarian employed by Fast Vet Services. Susan is a self-employed veterinarian. During the current year, Alexa

ndra and Susan have the same amounts of income and deductions. How does a deductible expense paid by Susan affect her taxable income differently than the payment of the same expense by Alexandra
Business
1 answer:
melomori [17]3 years ago
3 0

Answer/Explanation:

Susan's veterinary expenses are deductible for adjusted gross income

because she is self-employed and at the same time her vet practice constitutes a business.

Therefore, all of her veterinary expenses are deductible for adjusted gross income.

Alexandra is said to be in a trade or business as an employee and

the unreimbursed expenses of an employee are deducted as miscellaneous itemized deductions.

Therefore, Alexandra only benefits if she itemizes her deductions while Susan will always get the full benefit of the deduction.

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Spending variance is 300 Unfavourable.

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Spending variance, also known as rate variance, is the difference between the actual amount of an expense and the budgeted amount. If you have a utility bill of $250 in January and you expect to incur an expense of $150, you have an unfavorable expense variance of $100.

Spending variance is the difference between the actual amount of an expense and the expected (or budgeted) amount. So if a company has spent $500 on utilities in January and plans to spend $400, the result is a $100 unwanted spending difference.

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