Answer:
E) Market Exchange
Explanation:
Market exchange refers to at least two people or firms trading one good or service for another. In this case, the theater group is trading a free show and other promotional activities (standup comedy nights, and volunteer work) in exchange for higher membership to their group or higher attendance to their shows.
A trade does not necessarily imply a money exchange, it can also include goods or services that provide utility for the other party. For example, an increase in group membership will help the theater group perform better.
Answer:
$143.30
Explanation:
In order to determine the principal reduction payment, the monthly interest will need to be calculated. The interest will then be deducted from the total monthly payment to compute the principal reduction payment:
Annual Interest = $118,000 X 7/100
= $8,260
Monthly interest = $8,260/12
= $688.33
Principal reduction = $831.63 - $688.33
= $143.30
The National SMART grant <span />
Answer:
a. Gordon made a gift when the real estate was purchased of <u>$450,000</u> to Fawn.
Since Gordon gave 50% of the real estate to his sister as a gift when he purchased it, the gift must be valued at the time it happened ($900,000 x 50%)
b. Gordon's estate must include <u>$2,900,000</u> as to the property.
Gordon purchased all the real estate by himself, so his estate must include the value of the whole property.
c. How would the estate tax consequences change if it was Fawn (not Gordon) who died?
Fawn's estate would include <u>$0</u> as to the property.
Since Fawn didn't buy the property, her estate cannot include any amount of it.
Answer:
The Journal entries are as follows:
(i) On December 31,
No entry
(ii) On December 31,
Amortization expense A/c Dr. $16,000
To Patents A/c $16,000
(To record the amortization expenses)
Workings:
Amortization expense:
= (Purchasing cost of patent ÷ Estimated useful life) × Time period
= ($144,000 ÷ 6) × (8/12)
= $24,000 × (8/12)
= $16,000
