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
vodomira [7]
3 years ago
5

Casper and cecile are divorced this year. as part of the divorce settlement, casper transferred stock to cecile. casper purchase

d the stock for $25,000, and it had a market value of $43,000 on the date of the transfer. cecile sold the stock a month after receiving it for $40,000. in addition casper is required to pay cecile $1,500 a month in alimony. he made five payment to her during the year. what are the tax consequences for casper and cecile regarding these transactions? if an amount is zero, enter "$0".
Business
1 answer:
andre [41]3 years ago
6 0

<span>Separate maintenance payments and alimony are deductible by the party creating the payments and are includible in the gross income of the party getting the payments. Therefore, income is shifted from the income earner to the income beneficiary, who is better able to pay the tax on the amount received.</span>

You might be interested in
Riley Company promises to pay Janet Anderson or her estate $150,000 per year for the next 10 years, even if she leaves the compa
Jlenok [28]

Answer:

The Answer is explanatory so it is given as under:

Explanation:

<u>Part 1. At the start of the year:</u>

The part of the salary includes $150,000 per year for the next 10 years and this must be recorded as an deferred compensation liability. All we have to do is to calculate the present value of the annual salary payments.

Present Value = Annual Payment * Annuity factor

And for Annuity factor we will use 5% rate of interest.

So

Annuity Factor = (1 - (1-r)^n) / r

Here

r = 5%

n = 10 years

Which means

Annuity Factor = (1 - (1 + 5%)^10)  / 5%   = 7.722

Hence

Present value = $150,000 * 7.722 = $1,158,260

So the journal entry would be as under:

Dr Deferred Compensation expense $1,158,260

Cr    Deferred Compensation Liability $1,158,260

<u>Part 2. At the end of the Year 1:</u>

At the first year end, the annual payment of $1,158,260 will be discounted back by using the following formula:

Discounted Back Amount = Annual Amount * (1- (1+r)^n)

Remember for the first year n is 10, for second n is 9 and so on.

Discounted Back Amount = 150,000 x (1 - 0.614) = $57,913

Dr Deferred Compensation Expense   $57,913

Cr    Deferred Compensation Liability        $57,913

Part 3. And when the first payment of the salary is made, the journal entry would be:

Dr Deferred compensation Liability $ 150,000

Cr                                       Cash Account    $150,000

Likewise we will till the year 10 and will record the part 2 and part 3 until at the end of the year 10, the whole of the deferred tax liability is reduced to zero.

The life insurance policy payments can not be offset against the deferred compensation liability because it will be accounted for as a different transaction and hence must not be treated as Riley desires.

So the Cash surrender value will be treated as an asset and annual increase in this asset would be treated as an income.

5 0
3 years ago
Which core process includes the activities required to produce and deliver the service or product to the external customer?
krek1111 [17]

The core process which includes the activities required to produce and deliver the service or product to the external customer is <u>order</u> <u>fulfillment</u> <u>process</u>

Order fulfilment is a process of fulfilling a sales order according to the customer's specifications. That is, delivering goods as promised at the time of sale. There are four main steps in fulfilling a customers order which are-  processing orders, warehousing, packing, and shipping products.

After the customer places an order, there is a procedure to be followed where you need to prepare and deliver the items accordingly. This process typically takes up to 48-72 hours to be completed.

After an order has been submitted for fulfillment, it has to be received and accepted by the logistics company.

Hence, the answer was given and explained above.

To learn more about the order fulfillment process here:

brainly.com/question/9694610

#SPJ4

5 0
2 years ago
A gardener has three herb beds she wishes to plant in a design that consists of three equilateral triangles laid out in such a w
densk [106]
The design is shown in the attached picture. An equilateral triangle has sides that have equal measurements. On the other hand, a vertex is the terminal point of at least two line segments. Therefore, when you join three equilateral triangles sharing a common vertex, that simply means that they have a common point.

8 0
3 years ago
Suppose that the price of a rental car (Prc) is $50 while the price of a flight (Pfl) is $85. Also, suppose that the marginal ut
Masteriza [31]

Answer:

Consumers should choose to take the flight.

Explanation:

The price of a rental car = $50

Marginal utility from the car = 20 utils

Now find the per dollar utility from car = $50 / 20 = 2.5

The price of a flight = $85

Marginal utility from the flight = 30 utils

Now find the per dollar utility from flight = $85 / 30 = 2.83

Since the per dollar, MU is greater in the case of flight so consumers should choose to take the flight.

6 0
3 years ago
Monetary policy theory says that when the economy is faced with inflation, the government should
pogonyaev
Decrease the supply of credit ... 

5 0
3 years ago
Other questions:
  • Question: Jane wants to open a brokerage account. What is one thing she should consider when trying to decide which type of acco
    14·1 answer
  • The particular type of shareholder voting used has become less important with the influence of takeovers, leveraged buy-outs, an
    10·1 answer
  • What is the annual percentage rate (APR) on a credit card? A. The expected return on the credit card company's investments B. Th
    5·2 answers
  • The nurse educator asks a student to list the 5 main categories of complementary and alternative medicine (CAM), developed by th
    15·1 answer
  • What are the short-run economic effects when u.s. firms substitute labor outside of the u.s. for labor inside the u.s.?
    15·1 answer
  • Kevin has considered selling franchises of his very successful hardware store. however, he is concerned that the franchises will
    7·1 answer
  • Suppose that an economy is currently experiencing a Contractionary Gap due to a recession. The government decides to help the ec
    5·1 answer
  • Bond Corporation issues 5,000, 10-year, 8%, $1,000 bonds dated January 1, 2017, at 103. The journal entry to record the issuance
    6·1 answer
  • Determining Missing Items from Computations Data for the California, Midwest, Northwest, and Texas divisions of Firefly Industri
    9·1 answer
  • Assets are financed by creditors and owners. At 1/29/2021, approximately what percentage of Dollar General’s assets are financed
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!