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bazaltina [42]
3 years ago
15

Manny hired his brother’s firm to provide accounting services to his business. During the current year, Manny paid his brother’s

firm $94,000 for services even though other firms were willing to provide the same services for $64,000. How much of this expenditure, if any, is deductible as an ordinary and necessary business expenditure?
Business
1 answer:
Naily [24]3 years ago
3 0

Answer:

$64,000

Explanation:

In order to be deductible, a business expense must be both ordinary and necessary. Being ordinary means that it is a plausible expense for this business, since the expense in question is related to accounting services, it is ordinary. Being necessary means that the expense is the minimum required and is appropriate and helpful to the business. In this case, all of the expense was not required, therefore, only $64,000 (the reasonable market value for the services provided) are deductible.

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Which of the following is TRUE regarding investment intermediaries? Group of answer choices Insurance companies can be both "buy
pogonyaev

Answer:

A diversified portfolio of securities offers lower risk than a portfolio with investments that are concentrated in a few stocks or industries TRUE, A DIVERSIFIED PORTFOLIO WILL REDUCE RISK THROUGH DIVERSIFICATION, WHILE CONCENTRATION OF A FEW STOCKS INCREASES RISK.  

the other statements are false:

  • Insurance companies can be both "buy side" and "sell side" institutions. FALSE
  • Investment banks fund their assets primarily by selling shares FALSE
  • Commercial banks intermediate between Investors and Markets FALSE
  • Investment banks have higher assets under management than Mutual Funds FALSE

7 0
3 years ago
Determine whether each of the following topics would more likely be studied in microeconomics or macroeconomics. The effect of g
DaniilM [7]

Answer: See explanation

Explanation:

We should note that microeconomics deal with a particular sector in the economy and not the whole sector. Macroeconomic deals with the whole economy and looks at ways by which the decisions of government have an effect on the whole economy.

Based on the above explanation, the answer is provided below:

• The effect of government regulation on a monopolist's production decisions= Microeconomics

• The effects of government tax policy on long-term economic growth = Macroeconomics

• The optimal interest rate for the Federal Reserve to target = Macroeconomics

4 0
2 years ago
A monopoly market is characterized by the inverse demand curve P = 1,200 – 40 Q and a constant marginal cost of $200. If the mar
Sergeeva-Olga [200]

Answer:

The profit maximizing output level declines by 2.5 units and the price rises by $100.

Explanation:

In a monopoly market the inverse demand curve is given as,

P = 1,200 - 40Q

The marginal cost of production of the last unit is $200.

The total revenue is

= Price\times Quantity

= 1,200Q - 40Q^{2}

The marginal revenue of the last unit is

= \frac{d}{dx} TR

= 1,200 - 80Q

At equilibrium the marginal revenue is equal to marginal price,

MR = MC

1,200 - 80Q = 200

80Q = 1,000

Q = 12.5

Putting the value of Q in the inverse demand function,

P = 1,200 - 40\times 12.5

P = $700

Now, if the marginal cost rises to $400,

At equilibrium the marginal revenue is equal to marginal price,

MR = MC

1,200 - 80Q = 400

80Q = 800

Q = 10

Putting the value of Q in the inverse demand function,

P = 1,200 - 40\times 10

P = $800

4 0
3 years ago
8. The TS Company has budgeted sales for the year as follows: Quarter 1 Quarter 2 Quarter 3 Quarter 4 Sales in units 10,000 12,0
Finger [1]

Answer:

Results are below.

Explanation:

<u>First, we need to determine the production budget using the following formula:</u>

Production= sales + desired ending inventory - beginning inventory

Quarter 1:

Production= 10,000 + (0.25*12,000) - 2,500

Production= 10,500

Quarter 2:

Production= 12,000 + (0.25*14,000) - 3,000

Production= 12,500

Quarter 3:

Production= 14,000 + (0.25*16,000) - 3,500

Production= 14,500

Quarter 4:

Production= 16,000 - 4,000

Production= 12,000

<u>Now, the direct material purchase budget:</u>

Purchases= production + desired ending inventory - beginning inventory

Quarter 1:

Purchase= 10,500*4 + (12,500*0.1) - 4,200

Purchase= 39,050 pounds

Quarter 2:

Purchase= 12,500*4 + (14,500*0.1) - 1,250

Purchase= 50,200 pounds

Quarter 3:

Purchase= 14,500*4 + (12,000*0.1) - 1,450

Purchase= 57,750 pounds

Quarter 4:

Purchase= 12,000*4 - 1,200

Purchase= 46,800 pounds

3 0
2 years ago
Which of the following charitable contributions is not tax deductible? a. Time donated to a qualified veterans’ organization. b.
igor_vitrenko [27]

Answer:

Time donated to a qualified veterans organization

Explanation:

The reason is that the company can only only deduct the products or services delivered which had cost the organization. The companies are not allowed to deduct the cost of time delivered however if the employee is specially paid to offer the services to qualified charitable institution then the charity would be tax deductable.

6 0
3 years ago
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