Answer:
C) $0 $285,000
Explanation:
The §121 exclusion establishes that homeowners can exclude from their capital gains taxes the sale of their property for a maximum of $250,000 gain (or $500,000 for joint filers) if they meet two criteria:
- they owned the property for at last 5 years
- they use the property as main residence for at least 2 years (they can aggregate time periods).
So if Eric and Katie use the §121 exclusion they wouldn't pay any capital gains tax ($500,000 is higher than $375,000).
If they decide to forgo the §121 exclusion, then they will have to pay taxes for a gain of:
capital gain = net sale price - asst basis
capital gain = ($375,000 - $10,000) - $80,000 = $365,000 - $80,000 = $285,000
Answer:
✔️Demand Pull Inflation:
1. Too much money chasing too few goods
2. Stiff competition among consumers
✔️Cash Pull Inflation:
1. Increase in cost of production
2. Decrease in supply of goods and services
3. Aim of sellers is to maximize profit
Explanation:
Demand pull inflation is often caused by the increase in the aggregate demand of outputs than an economy can produce as a result of increased government spending, expanding economy and so on.
On the other hand, cash pull inflation is caused by the decrease in aggregate supply of goods and supply as result of increased cost of the factors of production.
Thus, let's match each description to the types of inflation they belong to:
✔️Demand Pull Inflation:
1. Too much money chasing too few goods (excess demand as a result of expanding economy)
2. Stiff competition among consumers (businesses, households, governments and foreign buyers bid prices up and compete to purchase the limited available goods and services)
✔️Cash Pull Inflation:
1. Increase in cost of production (this pushes the cost of goods and services up)
2. Decrease in supply of goods and services (aggregate supply decreases)
3. Aim of sellers is to maximize profit (as production cost increase, sellers would have to increase the price of goods and services in order not to run at a loss).
Answer:
The journal entry is given as follows;
Explanation:
Accounts Receivable-Valley Spa Dr.$7,930
Interest Revenue (7,800*10%*2/12) Cr.$130
Notes Receivable Cr.$7,800
Answer:
$130,000
Explanation:
In this question, we are going to calculate Andrew’s economic profit.
To do this, we first identify the mathematical formula that could help us arrive at the answer.
Mathematically, economic profit = Total revenues-(explicit cost + implicit cost)
Explicit cost are referred to as direct payment made by the business. Here, the explicit cost include ,cost of labor and start up costs. The value is thus 30,000 + 60,000 = $90,000
The implicit cost here is the opportunity cost, which is the amount she would have earned at her previous job. Another implicit cost here is the $10,000 he is supposed to pay for rent but does not since he owns the building
The Economic profit is thus = 300,000 -90,000-10,000-70,000 = $130,000
Answer:
- a. Population proportion = 0.40
- b. Sample proportion = 0.35
Explanation:
Question wants to know the population proportion and the sample proportion.
a. Population proportion:
The population in this case is the U.S. workers employed as purchasing managers. The proportion that we are interested in is the 40% that are female.
Population proportion is therefore 0.40.
b. The sample proportion uses the sample details not the population details:
= Number of females employed as Purchasing managers in sample / Number of Purchasing managers in sample
= 70 / 200
= 0.35
