Calculate the allowed interest expense deduction under IRC 163j based on the following income statement:

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Calculate the allowed interest expense deduction under IRC 163j based on the following income statement:
Gross Sales
Cost of Goods Sold
Gross Profit
Interest Expense- regular
Depreciation
Interest Expense Floor Plan
All other deductions
Total Business Deductions
Net Income
Interest Income Earned
$35,000,000
22,000,000
13,000,000
7,000,000
1,000,000
200,000
3,000,000
11,200,000
1,800,000
40,000
Capital Gain- non-business
Taxable Income before 163j limit $1,890,000
50,000
Transcribed Image Text:Calculate the allowed interest expense deduction under IRC 163j based on the following income statement: Gross Sales Cost of Goods Sold Gross Profit Interest Expense- regular Depreciation Interest Expense Floor Plan All other deductions Total Business Deductions Net Income Interest Income Earned $35,000,000 22,000,000 13,000,000 7,000,000 1,000,000 200,000 3,000,000 11,200,000 1,800,000 40,000 Capital Gain- non-business Taxable Income before 163j limit $1,890,000 50,000
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