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Svetradugi [14.3K]
3 years ago
11

Piper owns a vacation cabin in the Tennessee mountains. Without consider-ing the cabin, she has gross income of $65,000. During

the year, she rents the cabin for two weeks for $2,500 and uses it herself for four weeks. The total expenses for the year are $10,000 mortgage interest; $1,500 property tax; $2,000 utilities, insurance, and maintenance; and $3,200 depreciation.
a. What effect does the rental of the vacation cabin have on Piper’s AGI?
b. What expenses can Piper deduct, and how are they classified (i.e., for or from AGI)?
Business
1 answer:
ad-work [718]3 years ago
5 0

Answer and Explanation:

a)  rent income from sarah's vacation house will not affect her AGI, because according to rules if vacation house is used fewer than 15 days, in that case it is treated as a personal house and its expenses and income have not effect on the AGI. only the mortgage interest and property yax will be deducted from AGI.

b) only the mortgage interest and property yax will be deducted from AGI. other expenses are non-deductible from AGI because these are treated as personal expenses.

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3 years ago
Assume starbucks increased its spending on advertising by 35 percent to increase sales in its current markets. Which growth stra
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We can see here that if we assume that Starbucks increased its spending on advertising by 35 percent to increase sales in its current markets. The growth strategy this​ represents is: (d) Market penetration.

<h3>What is market penetration?</h3>

Market penetration actually refers to the success recorded by an organization or company in the selling of their goods and services to a specific market. Sales volume of the existing goods or services is actually used to measure market penetration.

The options that complete the question are:

(a) Market development

(b) Divesting

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Thus, if Starbucks was able to increase its spending on advertising by 35 percent in order to increase sales in its current markets, then they had market penetration.

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5 0
2 years ago
Suppose the price of a gallon of ice cream rises from $4 to $5, and the price of a can of coffee rises from $2 to $2.50. If the
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Answer:

a. less ice cream, less coffee

Explanation:

The percentage change in CPI is given by:

\%CPI = \frac{177-150}{150}=0.18

The percentage change in the prices of coffee and ice cream, respectively, are:

\%C = \frac{5-4}{4}=0.25\\\%I = \frac{2.50-2.00}{2.00}=0.25

Both coffee and ice cream had an increase in price above the CPI increase, which means that both goods are being sold above the equilibrium price and thus their demand is likely to fall.

People likely will buy less ice cream, less coffee

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3 years ago
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True

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Explanation:

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