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mel-nik [20]
3 years ago
6

Using property she inherited, Lei makes a 2020 gift of $16,200,000 to her adult daughter, Doris. Neither Lei nor her husband, Gr

eg, has made any prior taxable gifts. Assuming that a flat 40% tax rate applies, determine the Federal gift tax liability if (a) the election to split gifts is not made and (b) the election to split gifts is made. (c) What are the tax savings from making the election
Business
1 answer:
weeeeeb [17]3 years ago
4 0

Answer:

a)$1,842,000

b) $808,500 each

c) $$1,842,000

Explanation:

Worth of Gift made = $16200000

Assuming a Flat rate of 40%

Determine federal gift tax liability

<u>a) When Election to split gift is not made </u>

Taxable gift = $162,000,000 - annual exclusion

                    = 162,000,000 - 15,000

                    = $16,185,000

Determine the Gift tax = [ 345800 + ( 16,185,000 - 1,000,000 ) 40% ]

                                     = $6419800

<em>  applying values gotten from computing tax table ( Appendix A )</em>

Given that the max credit allowed for 2020 = $4577800

hence Gift tax due = $1,842,000 ( 6419800 - 4577800 )

<u>b) If election to split is made  i.e. section 25I3 is elected </u>

Gift tax due =  $8,100,000 - $15,000 = $808,500 each ( Greg and Lei

i.e. For Greg and Lei

<u>c) Tax savings made </u>

Tax savings  =$1,842,000 ($1,842,000 -$0)

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Tanning Company analyzes its receivables to estimate bad debt expense. The accounts receivable balance is $344,000 and credit sa
umka21 [38]

Answer:

c. Bad Debt Expense 14,600 Allowance for Doubtful Accounts 14,600.

Explanation:

As for the information provided,

outstanding balance of accounts receivables = $344,000

Also that the uncollectible balance of accounts receivables is estimated = 5% of outstanding balance.

Therefore, balance at year end of allowance for uncollectible shall be = $344,000 \times 5% = $17,200

Provided existing balance of allowance = $2,600

Thus, entry shall be for amounting = $17,200 - $2,600 = $14,600.

5 0
2 years ago
One suggestion for helping poor countries enjoy the benefits of free trade is for richer nations to reduce barriers to importing
boyakko [2]

The suggestion is that poor countries reduce barriers to products relating to agriculture and <u>textile </u>products.

<h3>Why the suggestion?</h3>
  • It is thought that poorer nations produce certain type of products and these should be traded freely in developed countries.
  • It is hoped that this would allow poorer nations to become richer.

Some of those products include agricultural and textile products, both of which require little processing from raw materials which are abundant in poorer nations.

Find out more on agriculture in poorer nations at brainly.com/question/25077523.

7 0
2 years ago
In the long run, firms under monopolistic competition_____ A. Standardize their products. B. Face perfectly elastic demand curve
grigory [225]

Answer:

The correct answer is letter "C": Earn zero economic profit.

Explanation:

For markets that have many companies offering similar products or services, monopolistic competition exists. Restaurants, grocery stores, and clothing stores, for example. Such similar products or services are not ideal replacements for each other in monopolistic competition. In the short run, the economic profit of the firms is positive but in the long run, the economic profit approaches to zero.

4 0
3 years ago
As a member of UA Corporation's financial staff, you must estimate the Year 1 cash flow for a proposed project with the followin
Airida [17]

Answer:

Option (C) is correct.

Explanation:

EBIT = Sales revenues - Depreciation - Other operating costs

        = $39,500 - $10,000 - $17,000

        = $12,500

EBT/PBT = EBIT - Interest expense

               = $12,500 - $4,000

               = $8,500

PAT = EBT - Tax rate

      = $8,500 - 35% of $8,500

      = $8,500 - $2,975

      = $5,525

CFAT = PAT + Depreciation

         = $5,525 + $10,000

         = $15,525

Therefore, the Year 1 cash flow is $15,525.

8 0
3 years ago
PLEASE HELP : Which of these investments may be long term? Check all that apply.
Stels [109]

Answer:

mutual funds

bonds

retirement funds

commodities

Explanation: i just took it

3 0
3 years ago
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