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ira [324]
3 years ago
10

Meredith is a passive 30% member of the MNO LLC. She is not a managing member and she does not participate in any activities of

the LLC. Her interest is more in the nature of an investment. In the current year, Meredith's distributive share of income from the LLC was $50,000. In addition, she received a guaranteed payment of $40,000 for the use of her capital. Assume that her income from other sources exceeds $500,000. How much of Meredith's LLC income will be subject to the self-employment (SE) tax (under the Proposed Regulations) and the net investment income (NII) tax? (Disregard the additional Medicare tax on upper-income taxpayers.)a.$90,000 SE tax; $0 NII tax.b.$0 SE tax; $90,000 NII tax.c.$50,000 SE tax; $40,000 NII tax.d.$0 SE tax; $0 NII tax.e.$0 SE tax; $40,000 NII tax.

Business
1 answer:
goldfiish [28.3K]3 years ago
7 0

Answer

b.$0 SE tax; $90,000 NII tax.

The answer and procedures of the exercise are attached in the following image.

Explanation  

Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.  

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A company’s retained earnings increased $375,000 last year and its assets increased $973,000. The company declared a $79,000 cas
Alex Ar [27]

Answer:

C. $454,000.

Explanation:

We know that

The ending balance of retained earnings = Opening balance of retained earnings + net income - dividend paid

$375,000 = $0 + net income - $79,000

So, the net income would be

= $375,000 + $79,000

= $454,000

The ending balance of retained earnings - Opening balance of retained earnings is also known as increase in retained earning

6 0
3 years ago
An appraiser valued a subsidiary of Signal Co. at between $230 million and $260 million. One month later, Burmah Oil offered to
Goshia [24]

Answer:

No, because they violated the duty of care

Explanation:

Business judgement rule is a provision that protects the management of a business from frivolous legal action concerning the way it does business.

The court assumes that the management acts in good faith in its fiduciary role, standard of loyalty, prudence, and care.

Duty of care is breached when the management do not make reasonable effort to prevent injury or loss.

In this instance Signal board is not protected by the business judgement rule because they violated duty of care.

Although the offer by Burmah oil is above the valuation a month ago, the board did not bother to do a present valuation or find out if other companies want to buy the subsidiary at a higher price.

8 0
3 years ago
Kohler Corporation reports the following components of stockholdersâ equity on December 31, 2016:
Flauer [41]

Answer:

Explanation:

1. Jan 1

   Paid Up Capital   (6,000*15)      Dr.$     90,000

   Paid in Capital in excess of par value  Dr.$30,000

   Treasury stock (6,000*20)     Cr.$   120,000

Jan 5.   Dividend   (55,000-6,0000=49,000*2)   Dr.$98,000

            Dividend Payable                                             Cr.$98,000

Feb 28.  Dividend Payable   Dr.$98,000

               Bank                      Cr.$98,000

July 6    Bank (2,250*24)     Dr.$54,000

             Paid up capital (2,250*15)   Cr.$33,750

             Paid in capital in excess of par (2250*9) Cr.$20,250  

Aug 22   Cash (3,750*17)    Dr.$63,750

              Paid up capital (3,750*15)  Cr.$ 56,250

              Paid in capital in excess of par Cr.$7,500

Sept 5.   Dividend (49,000+2,250+3,750)*2  Dr.$110,000

              Divided Payable             Cr.$110,000

Oct 28.  Dividend Payable    Dr.$110,000

             Cash                         Cr.$110,000

Dec 31   Income Summary   Account   Dr.$428,000

             Retained Earnings                   cr.$428,000

2.Statement of retained Earnings

 Retained Earnings at beginning          $460,000

Add; Net income for the year                  $428,000

Less: Dividends paid(98,000+110,000)  ($208,000)

Retained earnings as at December 31,2017 $680,000      

3. Stockholders' Equity  Section of Balance Sheet  

Retained earnings                        $680,000

Paid Up Capital Outstanding

(825,000-90,000+33,750+56,250) $915,000

Paid in capital in excess of par

(70,000-30,000+20250+7500)      $67,750  

Total stockholders' equity            $1,662,750

   

         

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Answer:

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If demand for a good falls, but the opportunity cost of making the good increases, then production of the good will:________
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