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bekas [8.4K]
3 years ago
13

Browne, a self-employed taxpayer, has 2018 business net income of $15,000 prior to any expense deduction for equipment purchases

. In 2018, Browne purchases and places into service, for business use, office machinery costing $20,000. This is Browne's only 2018 capital expenditure. Browne makes a proper and timely expense election to deduct the maximum amount (ignoring bonus depreciation). Browne is not a member of any pass-through entity. What is Browne's deduction under the election
Business
1 answer:
Vaselesa [24]3 years ago
7 0

Answer: $20,000

Explanation: A taxpayer who spends less than $800,000 on equipment can deduct the cost of

equipment purchases up to a maximum of $250,000 per tax year. The deduction is limited to the amount that will reduce taxable income to zero.

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is it a manager??

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3 years ago
The earnings reported by a company can be very different from its cash flows. There are companies that report very large positiv
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Answer:

High capital expenditures, low depreciation, increasing working capital        

Explanation:

In simple words, cash flows refers to the in and out transnfer of cash from and by a company while operating their business and doing several differnet transactions. You just had to spend a great deal for cashflow to really be unfavorable, despite higher profits. Reinvestment consists of two components: the disparity among the capital expenditure and the deterioration which is also termed as net capital expendture as well as  the working capital impact (with diminishing cash flows increasing).

3 0
3 years ago
Babcock Company purchased a piece of machinery for $36,000 on January 1, 2019, and has been depreciating the machine using the s
pogonyaev

Answer:

<u>Requirement 1:</u>

Dr Accumulated Depreciation $9,600

Cr Retained Earnings  Account      $9,600

<u>Requirement 2:</u>

Dr Depreciation Expense $6,000

Cr Accumulated Depreciation $6,000

Explanation:

Year  Remaining Life of machine  Depreciation fraction

1                               5                                           5/15

2                              4                                           4/15

3                              3                                           3/15

4                              2                                           2/15

5                          <u>    1     </u>                                       1/15

Total                       15  

Now here, the depreciation formula is as under:

Depreciation expense = (Cost - Salvage Value) * Fraction value

<u>Year 2019:</u>

The sum of years digit fraction would be 5/15 and the cost of the machinery is $36,000. So

Depreciation Expense = ($36,000 - 0) * 5/15  = $12,000

<u>Year 2020:</u>

The sum of years digit fraction would be 5/15 and the cost of the machinery is $36,000. So

Depreciation Expense = ($36,000 - 0) * 4/15  = $9,600

<u>Year 2021:</u>

Now in this year the there is change in estimate and a switch in the use of the depreciation method, which is now straight line method. The change in estimate only includes the useful life of the asset which is 6 years from the date of purchase.

So for straight-line depreciation:

Depreciation Expense = (Cost - Salvage Value)  / Useful Life

By simply putting values, we have:

Depreciation Expense = $36,000 / 6 years = $6,000 per year

So this means, according to change in accounting policy, the excess depreciation charged must be eliminated from the previous years. The depreciation charge for the previous 2 years must be $12,000 and the excess depreciation charge is calculated as under:

Carrying value of the asset = $21,600 - $12,000  = $9,600

<u>Requirement 1:</u>

The double entry according to the US GAAP, for the excess depreciation charge in the previous years would be the waiving off of retained earnings with the excess depreciation amount calculated above.

Dr Accumulated Depreciation $9,600

Cr Retained Earnings  Account      $9,600

<u></u>

<u>Requirement 2:</u>

The depreciation expense for the year 2021, would be recorded as under:

Dr Depreciation Expense $6,000

Cr Accumulated Depreciation $6,000

3 0
3 years ago
Which economic theory assumes individuals will use past values of inflation to predict the possible expected future values of in
OlgaM077 [116]

The rational expectations theory is a concept and theory used in macroeconomic.

what is rational expectations theory?

  • The rational expectations theory could be a concept and modeling method that's utilized broadly in macroeconomics.
  • The hypothesis sets that people base their choices on three essential variables: their human judiciousness, the data accessible to them, and their past experiences.
  • The theory proposes that people’s current expectations of the economy are, themselves, able to impact what long-term state of the economy will gotten to be.
  • This statute contrasts with the thought that government arrangement impacts monetary and financial decisions.

To know more about visit:

brainly.com/question/28197685?

#SPJ4

3 0
1 year ago
Your coin collection contains 59 1952 silver dollars. required: if your grandparents purchased them for their face value when th
ololo11 [35]
The coins were purchased in 1952 for their face value, one dollar per coin. This puts total face value at 59 dollars in 1952. They appreciate at 6.6% per year, so in 101 years, their value can be found through this calculation: 59 x (1.066^101) = $37,525.78.
7 0
3 years ago
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