Directions Choose the letter of the best answer. Write the letter for the answer on aseparate piece of paper.1. A person's "safe debt load" is often defined as of a person's after-tax income lessexpenses. If Devon's after-tax income is $23,930, and his expenses are $4,800 forhousing, $4,900 for food, $1,280 for transportation, and $950 for clothes, what isDevon's safe debt load?$3,000$4,000$6,000$12,000АВTEST-TAKING TIP If you do not knowthe answer to a question, make a noteand move to the next question. Comeback to it later, after you have answeredthe rest of the questions.CD

Given, Safe debt load = 1/3 * [After tax income - expenses] After tax income = $23,930

Answered: A person's "safe debt load" is often…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

Jamie Lee wants to determine if she can afford the monthly payments for all of her purchases before she completes the applica process. Use the information below to determine her debt payment-to-income ratio. Current Financial Situation Assets: Income: Checking account $1,900 Savings account $7,400 Gross monthly salary Net income $2,850 $2,195 Emergency fund savings account $2,900 Monthly Expenses: IRA balance $430 Rent obligation $370 Car $3,000 Utilities/Electric $80 Liabilities: Utilities/Water $50 Student loan $11,000 Utilities/Cable $75 (Jamie is still a full-time student, so Food $135 no payments are required on the loan Gas/Maintenance $140 until after graduation) Credit card payment $0 Acme Home Goods (Washer/dryer $1,650 Acme Home Goods $41 and refrigerator) Local Home Furnishings (Sofa $1,750 Local Home Furnishings $46 set) Big Box Store (52" LED HDTV) $1,150 Big Box Store $29 Automobile, Education, Personal, and Installment Loans Financial Institution or Account Number…
Andy's yearly income is $40,000. What would Andy's debt load be on a $15,000 personal loan? Would Andy's debt load follow the guidelines of the 20/10 rule? Provide a reason for Your answer.
You are a first-time homeowner and know you will only prequalify for an FHA loan. Your monthly gross income is $2,000. What is this minimum amount of recurring debt you are currently able to handle? (round to the nearest dollar) (DO NOT INCLUDE COMMAS AND S) Type your numeric answer and submit
1. Deductible transportation expenses: a.Do not include the normal costs of commuting. b.Do not include daily expenses for transportation between the taxpayer's home and temporary work locations if the taxpayer has a regular place of business. c.Include only costs incurred while away from home. d.Include meals and lodging. 2. Barry is a self-employed attorney who travels to New York on a business trip during 2021. Barry's expenses were as follows: Airfare $550 Taxis 40 Restaurant meals 150 Lodging 350 How much may Barry deduct as travel expenses for the trip? a.$0 b.$1,015 c.$940 d.$1,090 e.None of these choices are correct. 3. Which of the following is deductible as dues, subscriptions, or publications? a.Subscription to the "Journal of Taxation" for a tax attorney b.Dues to a health club for a doctor c.Dues to the drama club for a student d.Subscription to "Vogue" magazine for a corporate president e.None of these choices are correct.
Below is a graph of the Robinson's annual expenses. How much will the Robinsons pay in state/local taxes if their gross annual household income is S85,420? a.$3.559.17 b. $8,542.00 C. $20.500.80 d. $29,897.00
Ted Phillips has monthly take-home pay of $1,200; he makes payments of $450 a month on his outstanding consumer credit (excluding the mortgage on his home). How would you characterize Ted's debt burden?
Evaluating debt safety ratio. Use Worksheet 6.1. Chloe Young is evaluating her debt safety ratio. Her monthly take- home pay is $3,320. Each month, she pays $380 for an auto loan, $120 on a personal line of credit, $60 on a department store charge card, and $85 on her bank credit card. Complete Worksheet 6.1 by listing Chloe’s outstanding debts, and then calculate her debt safety ratio. Given her current take-home pay, what is the maximum amount of monthly debt payments that Chloe can have if she wants her debt safety ratio to be 12.5 percent? Given her current monthly debt payment load, what would Chloe’s take-home pay have to be if she wanted a 12.5 percent debt safety ratio?
Use the following information and the flow chart from the module to calculate: Adjusted gross income ( AGI) Taxable income Show your work for each calculation to receive full credit. An individual has the following information for the current tax year. Assume they do not itemize and they file as head of household. Income from wages, $80,000 Interest earned on savings, $150 IRA contribution, $5,000 Checking account interest earned, $75 Standard deduction for Head of Household: $20,800 Child and Dependent Care Tax credit, $3,000 Filing status: Head of Household
Katherine Hunt is evaluating her debt safety ratio. Her monthly take-home pay is $3,160. Each month, she pays $350 for an auto loan, $90 on a personal line of credit, $80 on a department store charge card, and $105 on her bank credit card. Complete Worksheet 6.1 by listing Katherine's outstanding debts, and then calculate her debt safety ratio. Round the answer to 1 decimal place. Enter debt safety ratio as a percentage. % Given her current take-home pay, what is the maximum amount of monthly debt payments that Katherine can have if she wants her debt safety ratio to be 12.5 percent? Round the answer to the nearest dollar. $ Given her current monthly debt payment load, what would Katherine's take-home pay have to be if she wanted a 12.5 percent debt safety ratio? Round the answer to the nearest dollar. $
Determine the amount of the child- and dependent-care credit to which each of the following taxpayers is entitled. If an amount is zero, enter "0". Round intermediate computations and final answer to the nearest dollar. Note: Round your percentage computations up to the next whole number before using in credit dollar amount computations. a. Caryle and Philip are married and have a 4-year-old daughter. Their adjusted gross income is $47,600, and they pay $2,300 in qualified child-care expenses during the year. Caryle earns $17,100, and Philip earns $30,500 in salary. $fill in the blank 1 b. Natalie is a single parent with an 8-year-old son. Her adjusted gross income is $25,000, and she pays $3,190 in qualified child-care expenses. $fill in the blank 2 c. Leanne and Ross are married and have three children, ages 6, 4, and 1. Their adjusted gross income is $77,000, and they pay $6,340 in qualified child-care expenses during the year. Leanne earns $47,600, and Ross earns…
For purposes of the Child and Dependent Care Credit, all the following are qualified expenses except for which one? a. نن فم b. d. A $700 adult day care expense for a disabled spouse while the taxpayer workers. A $450 childcare expense while the taxpayer obtains emergency medical care. A $500 payment to a grandparent for childcare while the taxpayer is employed. A $350 payment to a day care center while the taxpayer is looking for employment.
27. Indicate the proper federal income tax treatment of the item on an individual income tax return. State and local property taxes paid on a personal residence. Huge amount of tips received at your part-time job waiting tables at Whitehouse-Crawford. Alimony paid by professional golfer to deadbeat ex-husband who is unemployed. Regular Individual Retirement Account (IRA) 1. IN = Included in Gross Income contribution paid during the current year. 2. EX = Excluded from Gross Income Life insurance proceeds resulting from the death of 3. AG = Deducted in Arriving at Adjusted Gross Income your spouse. 4. DE = Deducted from Adjusted Cost of commuting to and Gross Income from work in Kennewick. 5. ND = Not Deductible in Computing Money inherited from a stranger whom you befriended 10 years ago in Seattle. Taxable Income. Interest income from a College Place water system bond. Tuition and fees paid by parents to cover their children's academy costs. Value of a trip to Hawaii won on Wheel of…

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS

A person's "safe debt load" is often defined as of a person's after-tax income les expenses. If Devon's after-tax income is $23,930, and his expenses are $4,800 fon ousing, $4,900 for food, $1,280 for transportation, and $950 for clothes, what is Devon's safe debt load? A $3,000