1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
OLEGan [10]
3 years ago
14

Five years ago, Tom loaned his son John $20,000 to start a business. A note was executed with an interest rate of 8%, which is t

he Federal rate. The note required monthly payments of the interest with the $20,000 due at the end of ten years. John always made the interest payments until last year. During the current year, John notified his father that he was bankrupt and would not be able to repay the $20,000 or the accrued interest of $1,800. Tom is an accrual basis taxpayer whose only income is salary and interest income. The proper treatment for the nonpayment of the note is:a. No deduction.b. $3,000 deduction.c. $20,000 deduction.d. $21,800 deduction.e. None of the above.
Business
1 answer:
Citrus2011 [14]3 years ago
6 0

Answer:

The answer is: B) $3,000 deduction

Explanation:

Tom can make only a $3,000 deduction this year since this loss qualifies as a capital loss. He doesn't have any capital gains to offset this loss. Therefore this year he is limited to make a $3,000 deduction against ordinary income and the remainder must be carried over to subsequent years.

You might be interested in
Lisa's opportunity cost rate is 10 percent compounded annually. How much must she deposit in an account today if she wants to re
Goryan [66]

Answer:

Present value = $21,804 (approx)

Explanation:

Given:

Periodic payment = $3,200

Number of period = 12

Interest rate = 10% = 10/100 = 0.1

Present value = ?

Computation of Present value:

Present\ value = PMT[\frac{1-(1+r)^{-n}}{r} ]\\\\Present\ value = 3,200[\frac{1-(1+0.1)^{-12}}{0.1} ]\\\\Present\ value = 3,200[\frac{1-(1.1)^{-12}}{0.1} ]\\\\Present\ value = 3,200[\frac{1-0.318630818}{0.1} ]\\\\Present\ value = 3,200[\frac{0.681369182}{0.1} ]\\\\Present\ value = 21,803.6188

Present value = $21,804 (approx)

8 0
3 years ago
If the price level increased from 200 to 250, then what was the inflation rate?
timurjin [86]
The answer is a. 50 percent
8 0
3 years ago
Read 2 more answers
6. The recommended approach for strategy formulation by a leader is for him or her to: Group of answer choices B. inspire a larg
larisa86 [58]

Answer:

B. inspire a large number of people to help achieve organizational purposes.

Explanation:

Business strategy sets the overall direction for the business; it focuses on defining how a business would achieve its goals, objectives, and mission; as well as the funds and material resources required to implement or execute the business plan.

The recommended approach for strategy formulation by a leader is for him or her to inspire a large number of people to help achieve organizational purposes.

8 0
3 years ago
Way Corporation disposed of the following tangible personal property assets in the current year. Assume that the delivery truck
Dvinal [7]

Answer:

ASSET   ORIGINAL BASIS   RATE   PROPORTION   DEPRECIATION

Furniture     $60,000              8.93%         50%                           $2679

Machinery   $72,000              10.93%       12.5%                         $983.70

Truck           $20,000              19.20%         50%                         $1920

Machinery  $280,000             7.55%        62.5%                      $48,212.50

Computer    $80,000                                  50%                    <u>         -           </u>

TOTAL                                                                                    <u>   $53,795.20</u>

Explanation:

Based on the MARCS depreciation table rates:

For a 7-year recovery period under the Half-Year (HY) Convention, in the 5th year rate = 8.93%

For a 7-year recovery period under the Mid-Quarter (MQ) Convention, purchased during the first quarter, in the 4th year rate = 10.93%

For a 5-year recovery period under the Half-Year (HY) Convention, in the 3rd year rate = 19.20%

For a 7-year recovery period under the Mid-Quarter (MQ) Convention, purchased during the fourth quarter, in the 2nd year rate = 27.55%

For disposal during a year,

Under the Half-year convention. The depreciation amount would be half i.e 50% of the total depreciation for the year

Under the Mid-quarter convention the percentage applied to the full year disposal is

12.5% for First Quarter

37.5% for Second Quarter

62.5% for Third Quarter

87.5% for Fourth Quarter

5 0
3 years ago
Cost data for Johnstone Manufacturing Company for the month ended March 31 are as follows: Inventories March 1 March 31 Material
snow_lady [41]

Answer:

cost of goods manufactured= $730,920

Explanation:

Giving the following information:

Materials $167,500 $149,080

Work in process 112,230 99,880

Direct labor $301,500

Materials purchased during March 321,600

Factory overhead incurred during March:

Indirect labor 32,160

Machinery depreciation 19,430

Heat, light, and power 6,700

Supplies 5,360

Property taxes 4,690

Miscellaneous costs 8,710

Total overhead= $77,050

<u>To calculate the cost of goods manufactured, we need to use the following formula:</u>

<u></u>

cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP

cost of goods manufactured= 112,230 + (167,500 + 321,600 - 149,080) + 301,500 + 77,050 - 99,880

cost of goods manufactured= $730,920

4 0
3 years ago
Other questions:
  • Barat owns a large chain of Indian markets. A significant part of his job is determining the amount of income left after taxes a
    10·1 answer
  • Agriculture commodities are usually sold under which environment
    12·1 answer
  • Bond Yields and Rates of Return A 30-year, 10% semiannual coupon bond with a par value of $1,000 may be called in 4 years at a c
    6·1 answer
  • I really need help I know this isn’t about school but it’s really important. Valentine’s Day is coming up and I already have som
    11·1 answer
  • Pitt Enterprises manufactures jeans. All materials are introduced at the beginning of the manufacturing process in the Cutting D
    8·1 answer
  • The placing of direct materials into the production process is recorded by an entry debiting:_________.A. Materials Expense.
    5·1 answer
  • Which of the following is a characteristic associated with warehouse showrooms?
    9·1 answer
  • Jack offers to sell Jill his automobile for $10,000. Jill says she must think about but that she is not rejecting his offer. Jil
    10·1 answer
  • The type of unemployment associated with recessions is called:
    15·1 answer
  • Bailey broker sponsors two sales agents: Jon and Jen. Horace has signed a buyer representation agreement with Bailey to have Bai
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!