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Svet_ta [14]
3 years ago
9

Tom Lewis, an individual taxpayer, performs services for the Red Cross at an out-of-town location for three weekends during the

year. There was no significant element of personal pleasure for Tom on these weekend trips. He incurred the following expenses in relation to these trips: Special uniform worn while performing services $100 Meals and lodging while on weekend trips 300 How much of the expenses may Tom deduct as a charitable donation on his Schedule A (itemized deduction) form (assuming that he can fully itemize and deduct all such expenses)
Business
1 answer:
lawyer [7]3 years ago
5 0

Answer:

The amount of the expenses that Tom may deduct as a charitable donation on his Schedule A is $400.

Explanation:

Since Tom's weekend trips were devoid of any significant element of personal pleasure and assuming that he can fully itemize and deduct all expenses incurred, the total amount of the expenses incurred in relation to the trips may be deducted by Tom as a charitable donation.

Therefore, we have:

Amount deductible as a charitable donation = Special uniform worn while performing services + Meals and lodging while on weekend trips = $100 + $300 = $400

Therefore, the amount of the expenses that Tom may deduct as a charitable donation on his Schedule A is $400.

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Assume an after-tax savings interest rate of 7 percent and a tax rate of 28 percent. (a) Calculate the total rental cost and tot
Readme [11.4K]

Complete Question

Annual rent $ 7,380

Insurance 145

Security deposit 650

Annual mortgage payments $9,800 ($9,575 is interest)

Property taxes 1,780

Insurance/maintenance 1,050

Down payment/closing costs 4,500 Growth in equity 225

Estimated annual appreciation 1,700

Assume an after-tax savings interest rate of 7 percent and a tax rate of 28 percent.

(a) Calculate the total rental cost and total buying cost.

Answer:

Explanation:

(a)Rental Costs

Buying Costs $7,380

Rent $9,800

The following calculations were made:

Interest lost on security deposit

= Security deposit × 7%

= $650 × 0.07 = $45.5

Interest lost on down payment and closing cost

= Down payment × 7%

= $4,500 × 0.07 = $315

Tax savings for mortgage interest =

Interest × 28%

$9,575 × 0.28 = $2,681

Tax savings for property taxes =

= Property taxes × 28%

$1,780 × 0.28 = $498

8 0
3 years ago
Adjusting Entries and Adjusted Trial Balances
Artist 52 [7]

Answer:

Emerson Company

1. Adjusting Journal Entries

Debit Insurance expense $2,190

Credit Prepaid Insurance $2,190

To record expired insurance expense for the year.

Debit Supplies expense $1,270

Credit Supplies $1,270

To record supplies expense for the year.

Debit Depreciation expense of building $2,950

Credit Accumulated depreciation - building $2,950

To record depreciation expense for the year.

Debit Depreciation expense of equipment $2,550

Credit Accumulated depreciation - equipment $2,550

To record depreciation expense for the year.

Debit Unearned rent $4,690

Credit Rent Revenue $4,690

To record rent earned for the year.

Debit Salaries and wages Expense $2,880

Credit Salaries and wages payable $2,880

To record accrued salaries and wages.

Debit Accounts receivable $16,910

Credit Fees earned $16,910

To record fees earned but unbilled.

2. Adjusted Trial Balance as of October 31, 20Y6

Emerson Company

Adjusted Trial Balance  as of October 31, 20Y6

                                                   Debit           Credit  

Cash                                         $3,930

Accounts Receivable              52,550

Prepaid Insurance                     4,450

Supplies                                        540

Land                                       104,800

Building                                269,090

Accumulated Depreciation—Building             $131,010

Equipment                            125,950

Accumulated Depreciation—Equipment          93,760

Accounts Payable                                                11,180

Salaries and Wages Payable                              2,880

Unearned Rent                                                    1,650

Suzanne Emerson, Capital                            285,400

Suzanne Emerson, Drawing 13,890

Fees Earned                                                    318,940

Rent Revenue                                                    4,690

Salaries & Wages Expense 182,890

Utilities Expense                  39,570

Advertising Expense             21,140

Repairs Expense                   16,010

Miscellaneous Expense        5,740

Insurance Expense                2,190

Supplies Expense                  1,270

Depreciation Exp. Building  2,950

Depreciation Exp. Equip.     2,550

Totals                              $849,510            $849,510

Explanation:

a) Data and Calculations:

Emerson Company

Unadjusted Trial Balance  as of October 31, 20Y6

                                                   Debit           Credit  

Cash                                         $3,930

Accounts Receivable              35,640

Prepaid Insurance                     6,640

Supplies                                       1,810

Land                                       104,800

Building                                269,090

Accumulated Depreciation—Building           $128,060

Equipment                            125,950

Accumulated Depreciation—Equipment           91,210

Accounts Payable                                                11,180

Unearned Rent                                                   6,340

Suzanne Emerson, Capital                           285,400

Suzanne Emerson, Drawing 13,890

Fees Earned                                                 302,030

Salaries & Wages Expense 180,010

Utilities Expense                  39,570

Advertising Expense             21,140

Repairs Expense                   16,010

Miscellaneous Expense        5,740

Totals                              $824,220          $824,220

Adjustments:

Prepaid Insurance balance = $4,450

Insurance expense = $2,190 (6,640 -4,450)

Supplies balance = $540

Supplies expense = $1,270 (1,810 - 540)

Depreciation expense of building = $2,950

Accumulated depreciation - building = $131,010 (128,060 + 2,950)

Depreciation expense of equipment = $2,550

Accumulated depreciation - equipment = $93,760 (91,210 + 2,550)

Unearned rent = $1,650

Rent Revenue = $4,690 (6,340 - 1,650)

Salaries and wages payable = $2,880

Salaries and wages = $182,890 (180,010 + 2,880)

Accounts receivable = $52,550 (35,640 + 16,910)

Fees earned = $318,940 (302,030 + 16,910)

3 0
3 years ago
You describe your interview subject’s perspective on the value of education, and you compare those ideas to the views of other p
defon

Answer:

well... read between linesssss

Explanation:

4 0
2 years ago
Sharon purchases two products, X and Y, with a given fixed budget. The marginal utility she receives from the last unit of X she
Elanso [62]

Answer:

A) is maximizing her total utility from the given fixed budget.

Explanation:

The equal marginal principle refers to the principle in which the consumer would select that combination of goods which maximise its total utility. It could be selected by having marginal utility and its price

And for profit maximization, the marginal utility and the price is equivalent to both the goods.

i.e

\frac{MU_X}{P_X} = \frac{MU_Y}{P_Y}

\frac{60}{2} = \frac{30}{1}

30 = 30

Hence, the correct option is a.

5 0
3 years ago
After the formation of a free trade area for its member countries, the United States found that its high-cost furniture producer
Damm [24]

Answer: Trade creation

Explanation:

Trade creation is the increase in economic welfare which occurs when a country joins a free trade area, like the customs union. Trade creation will happen when the ltariff barriers has been reduced which leads to lower prices.

Trade creation leads to lower cost on producers which will lead to a rise in economic welfare and consumer surplus. Trade creation also leads to expansion of trade.

6 0
3 years ago
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