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Vadim26 [7]
3 years ago
6

Robert is the sole shareholder and CEO of ABC, Inc., an S corporation that is a qualified trade or business. During the current

year, ABC has net income of $287,000 after deducting Robert's $86,100 salary. In addition to his compensation, ABC pays Robert dividends of $200,900.
a. What is Robert's qualified business income?
b. Would your answer to part (a) change if you determined that reasonable compensation for someone with Robert's experience and responsibilities is $181,050?
Business
1 answer:
goldenfox [79]3 years ago
5 0

Answer:

A. $287,000

B. $192,050

Explanation:

a. Based on the information givenwe were told that company ABC had net income of the amount of $287,000 after deducting Robert's salary of the amount of $86,100 which therefore means that ROBERT'S QUALIFIED BUSINESS INCOME will be the amount of $287,000.

b. Calculation to determine whether your answer to part (a) would change if you determined that reasonable compensation for someone with Robert's experience and responsibilities is $181,050

Based on the information given the amount of $192,050 will be the additional amount of salary that can be deducted which is Calculated as:

=[$287,000 - ($181,050-$86,100)]

=$287,000-$94,950

=$192,050

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A company purchases 12,000 pounds of materials. The materials price variance is $6,000 favorable. What is the difference between
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Answer:

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Given Data:

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We know the formula for Material Price Variance is:

Materials Price Variance = <em>(Actual quantity × Actual price)</em> – <em>(Actual quantity × Standard price) ----- (1)</em>

For convenience, suppose:

Actual  Price = AP    &  Standard Price = SP

Rearranging the equation (1) and substituting the Actual and standard price with AP and SP we get,

Material Price Variance = (Actual Quantity x AP) – (Actual Quantity x SP)

Taking Actual Quantity as common on the left hand side of equation we get:

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Putting the values of Material Variance and Actual Quantity in equation (2), we get:

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7 0
3 years ago
Nora contracts to work for ABC Investments during June for $2,500. On May 31, ABC cancels the contract. Nora refuses to accept a
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