Answer:
John should include $1,600 as rental income on his Year 4 tax return as a result of the $2,000 payment.
Explanation:
As a cash-basis taxpayer, John's taxable income is based on the actual cash receipts and payments made in the accounting period. The refundable part of the rent should not be included as rental income since it is a security deposit that would be returned at the end of the lease period. If John were an accrual-basis taxpayer, the rental income to be included would have been only $800 representing income for Year 4.
Answer and Explanation:
The Journal entries are shown below:-
1. Salary Expense $1,500
To Salary Payable $1,500
(Being salary expense is recorded)
Here we debited the salary expenses as it increased the expenses and we credited the salary payable as it also increased the liabilities
2. Salary Expense Dr, $2,100
Salary Payable Dr, $1,500
To Cash $3,600
(Being cash paid is recorded)
Here we debited the salary expenses and salary payable as it increased the expenses and decreased the liabilities and we credited cash as it reduced the assets
Answer: The correct answer is "D. It begins when the engagement letter is signed and continues until the report for the third year is issued unless the relationship is terminated sooner.".
Explanation: The statement "It begins when the engagement letter is signed and continues until the report for the third year is issued unless the relationship is terminated sooner." best describes the period of the professional engagement as it applies to a three-year engagement to audit client's financial statements since this type of professional commitment begins with the signing of the document that formalizes the commitment and is in force until the issuance of the last report unless the relationship is resolved beforehand by another circumstance.
Answer:
β = 1.45
Explanation:
The beta of the portfolio is defined as an average of the betas (β) of each asset within the portfolio weighted by their respective invested amounts (A):
The beta of the portfolio is 1.45
