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Bad White [126]
3 years ago
10

Jack and Diane decided to remodel their kitchen. They removed their old cabinets and replaced them with newer, nicer cabinets. T

hey installed the old cabinets in a rental home that they own and lease to other people. The original cost of the old cabinets was $6,000. The fair market value on the date they were installed in the rental house was $2,500. The cost of the new cabinets was $11,000. What amount should Jack and Diane use as the basis for depreciation for the cabinets that have been installed in the rental property?
Business
1 answer:
Hitman42 [59]3 years ago
4 0

Answer:

The answer is: $2,500

Explanation:

According to the IRS, the cost basis for any asset should be the original cost adjusted by its depreciation.

Since Jack and Diane aren't able to determine the depreciation expenses for the cabinets, they should use their fair market value as cost basis.

You might be interested in
How do you do income statement​
igomit [66]

To prepare an income statement, you will need to generate a trial balance report, calculate your revenue, determine the cost of goods sold, calculate the gross margin, include operating expenses, calculate your income, include income taxes, calculate net income and lastly finalize your income statement with business details and the reporting period.

If you can't find the time to make one from scratch, there are templates that can be used to help.

gross margin :  the amount of money a company retains after incurring the direct costs associated with producing the goods it sells and the services it provides.

net income : net earnings, is calculated as sales minus cost of goods sold, selling, general and administrative expenses, operating expenses, depreciation, interest, taxes, and other expenses.

3 0
2 years ago
Jane is an employee of Tyco, Inc. and she is in charge of payroll. Every week she issues a check in the name of a fictitious emp
KengaRu [80]

Answer:

b. Tyco is liable because it authorized Jane to issue payroll checks.

Explanation:

There is the company responsibility to put the right person for the specific job. Here in the given situation Jane would not be a liable person for an vital position of the company. in the case when the fraud done by the employee so the firm would be liable as the company provide the authorization to the person who have to perform that job

Therefore, the option b is correct

4 0
3 years ago
Return on investment (ROI) information can help you manage a client's campaign by helping you determine how to:
jeyben [28]

Answer:

The correct answer to the following question is option D) all of the listed answers are correct .

Explanation:

ROI ( which is know as return on investment ) is a tool which can be used to manage a client's campaign by helping him in determining what would be the optimal budget for him, how would a client optimize its advertisement texts and the keywords. The ROI here would be used to measure conversion and through this conversion tracking tool would help in determining profitability in advertisement or keywords.

7 0
3 years ago
Fall Co. paid $500 in freight-out charges to ship $25,000 of inventory on consignment to Rodgers Co. Rodgers printed and mailed
Aloiza [94]

Answer:

$5100

Explanation:

The cost of the inventory in $25000 and the cost of shipping it to the consignee, $500.

The cost of marketing brochures an comissions are recognized as expense and do not affect inventory.  If 80% of the inventory was sold, 20% remains, which will have a carrying value of $25,500 X 20% = $5100

6 0
3 years ago
The supply of headphones is linear and upward sloping, and the demand for headphones is linear and downward sloping. Suppose the
Norma-Jean [14]

Answer:

8,000

Explanation:

Initially, the market is at equilibrium E1: P = P1; Q = Q1

Assume that the tax is imposed, the market will move to when Q = Q2; the price buyers pay is greater than P1, the price producers receive is less than P1.

We have: <em>Price buyers pay - Price producers receive = Tax</em>

As the tax decreases the equilibrium quantity by 700 headphoes

=> Q1 - Q2 = 700

=> Q2 = Q1 - 700

=> Q1 + Q2 = Q1 + Q1 - 700 = 2Q1 - 700

Before tax:

+) the producer surplus (PS) is equal to the area formed by supply curve S, price line P1 and the vertical axis

=> PS1 = Area of BE1P1

+) the consumer surplus (CS) is equal to the area formed by demand D, price line P1 and the vertical axis

=> CS1 = Area of AE1P1

=> The wellness before tax = CS1 + PS1 = Area of AE1B

After tax:

+) the producer surplus (PS) is equal to the area formed by supply curve S, price line (Price producers receives) and the vertical axis

=> PS2 = Area of BDE

+) the consumer surplus (CS) is equal to the area formed by demand D, price line (price buyers pay) and the vertical axis

=> CS2 = Area of ACF

+) The Tax revenue = Tax * Q2 = (Price buyers pay - Price producers receive) * Q2 = CD * DE = Area of CFDE

=> The wellness after tax = PS2 + CS2 + Tax Revenue = BDE + ACF + CDEF

=> Deadweight loss = Wellness before Tax - Wellness after tax = Area of EFE1 = 2,800

The tax decreases consumer surplus by $4,000.00, and it decreases producer surplus by $6,800.00

So that:

+) CS1 - CS2 =  4,000

=> Area of AE1P1 - Area of ACF = Area of CFE1P1 = 4,000

+) PS1 - PS2 = 6,800

=> Area of BE1P1 - Area of BDE = 6,800

=> Area of EDP1E1 = 6,800

=> Area of CFE1P1 + Area of EDP1E1 = 4,000 + 6,800

=> Area of CFE1ED = 10,800

Area of CDEF + Area of EFE1 = Area of CFE1ED = 10,800

=> Area of CDEF + 2,800 = 10,800

=> Area of CDEF = 8,000

=> Tax revenue = 8,000

6 0
2 years ago
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