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Ad libitum [116K]
3 years ago
8

Leo is a self-employed architect who maintains a qualifying office in his home. Leo has $80,000 gross income from his practice a

nd incurs $72,000 in salaries, supplies, computer services, etc. In addition, Leo's mortgage interest and real estate taxes allocable to the office total $3,000. Additional other home office expenses total $9,000 and consist of depreciation, utilities, insurance, and maintenance. Leo's total home office deductions are:_______.
A) $10,000.
B) $15,000.
C) $20,000.
D) $95,000.
Business
1 answer:
pychu [463]3 years ago
8 0

Answer:

$8,000 (they cannot exceed total income ⇒ business expenses + home office deductions ≤ $80,000)

Explanation:

The Tax Cut and Jobs Act established a maximum of $5,000 (single filers) deduction for property taxes (so Leo's real estate tax qualifies), and since Leo is self-employed, he can also deduct mortgage interest.

Other office expenses can be deducted either total if they only apply to the home office or partially if they apply to the entire house, and must be assigned proportionally. These expenses generally include insurance, utilities, repairs, security system expenses, maid service, garbage disposal, and decorating expenses.

There are two ways to determine the amount of home office deduction:

  1. the simplified method which allocates $5 per square foot of home office (we are not given any measurement)
  2. you can add all you business expenses and they allocate a percentage. Here we can assume that the calculation has already been done by Leo. In this case, Leo's home office deduction + business deductions exceed his total income, so they are limited to = $80,000 - $72,000 = $8,000. The rest must be carried over to next year.

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in times of rising prices, cost of goods sold determined using the lifo inventory assumption typically will be than cost of good
LenKa [72]

When prices are rising, the Cost of Goods Sold according to LIFO will be <u>higher </u>than cost of goods sold under FIFO.

Last-In, First-Out (LIFO) refers to a company selling off the latest inventory that it receives first before the inventory it received earlier.

When prices are rising, LIFO will result in a higher COGS because:

  • Purchases will be high
  • Closing stock will be low on account of only the earlier cheaper inventory being left

In conclusion, LIFO results in cost of goods sold being higher because the closing stock which is deducted from COGS will be lower.

<em>Find out more at brainly.com/question/16379786. </em>

3 0
3 years ago
Multiple choice-- economics
gtnhenbr [62]

Answer:

The effect of increasing the money supply on inflation

Explanation:

Economics can be classified into two (2) categories, namely;

1. Macroeconomics can be defined as the study of behaviors, performance and factors that affect the entire economy. Hence, it focuses on aggregate phenomena such as price level, economic growth, Gross Domestic Product (GDP), inflation, unemployment and national income levels with respect to the central bank, demand or supply shocks, government policies, aggregate spending and savings.

2. Microeconomics can be defined as the study of the effect of price and quantity levels through interactions between individual buyers and sellers in various markets.

Hence, it is focuses on analyzing or evaluating the decisions of consumers (buyers) and those of firms (sellers) such as methods of production, pricing; and the manner in which government policies affect those decisions.

In conclusion, microeconomics focuses on all of the aforementioned statements except the effect of increasing the money supply on inflation because it is a macroeconomic factor.

5 0
3 years ago
D.v.g. (a minor) was injured in a one-car auto accident in hoover, alabama. the vehicle was covered by an insurance policy issue
diamong [38]

Answer:

Yes, the court ruled in favor of D.V.G.'s mother, because of the principle that contracts entered by minors are not void, but voidable, and that they do have an effect on the parties, but if voided, they cannot be enforced.

In this case, the minor died before the contract was ratified by the court, but the minor hadn't voided the contract, so it was still good at the moment of his death. The minor had the chance of either approving or rejecting the contract while still living, and decided not to revoke it.

Explanation:

NATIONWIDE MUTUAL INSURANCE COMPANY and State Farm Mutual Automobile Insurance Company v. Barbara Walker WOOD, as administratrix of the estate of D.V.G., a minor, deceased, and K.C.T., a minor, by and through Earnest T., his father and next friend.  1111486. Decided: February 22, 2013

As this Court has stated, <em>“ ‘[i]t is well settled by the authorities that infants are not liable on any of their contracts, except for necessaries. With the exception, all other contracts of infants, whether executory or executed, may be avoided or ratified at the election of the infant.’ ”</em>

The final ruling was:

<em>"Under Alabama law, an insurance company is bound to a settlement agreement negotiated on behalf of an injured minor, even if that minor dies before the scheduling of the court hearing that all parties agreed was necessary to obtain approval of the settlement agreement. In accordance with the parties' understanding, such a hearing is still required, and the minor's death does not render that hearing impossible. We thus answer in the affirmative the question certified to this Court."</em>

6 0
3 years ago
An export subsidy will ________ producer surplus, ________ consumer surplus, ________ government revenue, and ________ overall d
Paladinen [302]

Answer:

increase; decrease; decrease; decrease.

Explanation:

Trade can be defined as a process which typically involves the buying and selling of goods and services between a producer and the customers (consumers) at a specific period of time.

Basically, trade can be categorized into two (2) main groups and these are;

I. Import: this involves bringing in goods from a foreign country to sell in a different (domestic) country.

II. Export: it involves the sales of goods produced in a domestic country to a foreign country.

An export subsidy can be defined as any government policy that encourages the export of goods to other countries while discouraging the sales of goods in the domestic market through the use of tax reliefs, low cost loans, government foreign adverts, etc.

A surplus is the amount by which the quantity supplied of a good exceeds the quantity demanded of the good.

Producer surplus is the amount a buyer is willing to pay for a good minus the cost of producing the good.

Consumer surplus is the amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it.

Hence, an export subsidy will increase producer surplus, decrease consumer surplus, decrease government revenue, and decrease overall domestic national welfare.

5 0
3 years ago
Present value computation kerry bales won the state lottery and was given four choices for receiving her winnings. receive $400,
Mekhanik [1.2K]
Option 1: PV = $400,000
Option 2: Receive (FV) $432,000 in one year

PV = FV(1/(1+i)^n), where i= 8% = 0.08, n = 1 year

PV = 432,000(1/(1+0.08)^1) = $400,000

Option 3: Receive (A) $40,000 each year fro 20 years

PV= A{[1-(1+i)^-n]/i} where, n = 20 years

PV = 40,000{[1-(1+0.08)^-20]/0.08} = $392,725.90

Option 4: Receive (A) $36,000 each year from 30 years
PV = 36,000{[1-(1+0.08)^-30]/0.08} = $405,280.20

On the basis of present value computations above, option 4 is the best option for Kerry Blales. This option has the highest present value of $405,280.20

4 0
4 years ago
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