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Ede4ka [16]
3 years ago
7

Candlewood LLC started business on September 1, and it adopted a calendar tax year. During the year, Candlewood incurred $6,500

in legal fees for drafting the LLC's operating agreement and $3,000 in accounting fees for tax advice of an organizational nature, for a total of $9,500 of organizational costs. Candlewood also incurred $30,000 of preopening advertising expenses and $24,500 of salaries and training costs for new employees before opening for business, for a total of $54,500 of startup costs. The LLC wants to take the largest deduction available for these costs. If required, round any division to six decimal places and use in subsequent computations. Round your final answers to the nearest dollar. How much can Candlewood deduct as organizational expenses
Business
1 answer:
SpyIntel [72]3 years ago
8 0

Answer:

deduction for organizational expenses = $5,000

Explanation:

Since the total startup costs are over $50,000 then the company's deduction will be lower. Generally speaking, a company can deduct up to $5,000 in organizational an startup costs ($5,000 each). But if the costs are over $50,000, then your deduction will be reduced by $1 for each dollar over that threshold.

In this case, organizational costs were $9,500, so they can deduct $5,000 during the first year and $4,500 will be amortized over the next 15 years. Startup costs are $54,500, which means that they can only deduct $5,000 - ($54,500 - $50,000) = $500 during the first year. The remaining $54,000 must be amortized over a 15 year period. Total deduction during the first year = $5,000 + $500 = $5,500

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Lanni Products is a start-up computer software development firm. It currently owns computer equipment worth $30,000 and has cash
Misha Larkins [42]

Answer:

A-2 Ratio of real Assets to Total Assets = 0.3

B-2 Ratio of real Assets to Total Assets= 1

C-2 Ratio of real Assets to Total Assets= 0.2

The company has low ratio at the start , increases to full when producing and then again decreases.

Explanation:

The balance sheet after Lanni accepts the Bank Loan. The cash increases and so does the liability increases.

Lanni Products

Balance Sheet

Assets                                                Liabilities & Shareholders' Equity

Cash $ 70,000                                      Bank loan $ 50,000

<u>Computers $30,000                             Shareholders' equity 50,000</u>

<u>Total $      100,000                                                           Total $ 100,000</u>

<u />

A-2 Ratio of real Assets to Total Assets

Real Assets = $ 30,000

Total Assets = $ 100,000

Ratio = 30,000/100,000 = 0.3

B-1

Lanni Products

Balance Sheet

Assets                                                Liabilities & Shareholders' Equity

Software $ 70,000                                      Bank loan $ 50,000

<u>Computers $30,000                             Shareholders' equity 50,000</u>

<u>Total $      100,000                                                           Total $ 100,000</u>

<u />

The software costs $ 70,000. The Balance sheet is as given above and the cash will be replaced by the software.

B-2  Ratio of real Assets to Total Assets

Real Assets = $ 100,000

Total Assets = $ 100,000

Ratio = 100,000/100,000 = 1.0

C-1 The share given are calculated ( 1500 *80= $ 120,000) . And after it accepts the payment the share holder's equity increases and the assets as well.

Lanni Products

Balance Sheet

Assets                                                Liabilities & Shareholders' Equity

Shares  $ 120,000                                      Bank loan $ 50,000

( 1500 *80)

<u>Computers $30,000                             Shareholders' equity 100,000</u>

<u>Total $      150,000                                                           Total $ 150,000</u>

C-2 Ratio of real Assets to Total Assets

Real Assets = $ 30,000

Total Assets = $ 150,000

Ratio = 30,000/150,000 = 0.2

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Doc Xpress has an in-house staff of 35 employees who provide transcriptions of phone and video conferences for a range of client
siniylev [52]

Answer:

external threat

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This decision was likely based on an external threat. Which in this scenario is the economy. Economy is considered as an external threat because it is not in the control of the company itself but still directly affects the everyday business operations of the company as well as it's profit and costs. All of this equates to how well the company performs, therefore in a situation where the economy poses a threat decisions need to be made such as the one in this scenario.

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A Chinese company exchanges yuan (Chinese currency) for dollars. It uses these dollars to purchase scrap metal from a U.S. compa
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Answer:

d. decrease, and U.S. net capital outflow increases.

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In the context, China will buy scrap metal from United States, thus China is importing a good from U.S. So China will have more of import. Hence China net export will decrease. While U.S. is selling goods to China in exchange of dollar and earning capital. So, net capital outflow of the United States will increase.

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