chapter 4 home work

chapter 4 home work - Question 34 Answer. Memo To, Susan...

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Question 12 Answer. If wade sells his car then he has to pay tax on gain of income. Cost of recovery 7000+2400 (9400) Sell the car 13000 -------- Gain on car (taxable) 3600 If wade has already enough income then he has to pay tax with high percentage. In contrast, wade gives as gift to her daughter. It will exclude from gross income and also gift of car or property can be useful tax planning concept. Question 28: Item Corporate bonds Series bonds land Original investment 10000$ 10000$ 10000$ Annual income (500$) 12200$ Compound amount reinvested for 5 years at 5% before tax (5.53) 500$*5.53 = 2765$ Compound amount ,5 years at 5% 12800$ Net 2200$ 2800$ Tax (774.20$) (616$) (420$) Net 1990.80$ 1584$ 2380$ The land gain more income after tax 2380 $ rather than either bonds 1990.80$, 1584$ . It is amounted 389.20$ for corporate bonds and 796 $ for series bonds .
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Unformatted text preview: Question 34 Answer. Memo To, Susan apple Subject: Dispute over recording the income of paint shop Date 12/2012 Color paint shop.inc is an accrual basis taxpayer and can recognize income only when all the events have been occurred and they have the right to receive the income or the amount to be received can be determined with reasonable accuracy income 800 and deductible loss 200. In order to solve this first of all we should see the other party is not satisfied but in 12, 2011, they agreed to settle the dispute for $ 800 therefore the condition of all events is satisfied but the income cannot be determined with reasonable accuracy. Later on insurance company has approved this case. Thus Color paint shop can report $800 in the 2012....
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This note was uploaded on 03/07/2012 for the course BUS 603 taught by Professor Rosnin during the Spring '12 term at Rutgers.

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chapter 4 home work - Question 34 Answer. Memo To, Susan...

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