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Determine Santini's taxable income and income tax liability for 2023. Use Tax rate schedules and Exhibit 12-8. Note: Round your answers to the nearest whole dollar amount.

Determine Santini's taxable income and income tax liability for 2023. Use Tax rate schedules and Exhibit 12-8. Note: Round your answers to the nearest whole dollar amount.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Santini's new contract for 2023 indicates the following compensation and benefits: Salary Benefit Description Health insurance Restricted stock grant Bonus Hawaii trip Group-term life insurance Parking ($380 per month) Amount $ 142,500 21,500 2,500 7,500 6,500 4,100 4,560 Santini is 54 years old at the end of 2023. He is single and has no dependents. Assume that the employer matches $1 for $1 for the first $6,000 that the employee contributes to his 401(k) during the year. The restricted stock grant is 500 shares granted when the market price was $5 per share. Assume that the stock vests on December 31, 2023, and that the market price on that date is $70.00 per share. Also assume that Santini is willing to make any elections to reduce equity- based compensation taxes. The Hawaii trip was given to him as the outstanding salesperson for 2022. The group-term life policy gives him $150,000 of coverage. Assume that Santini does not itemize deductions for the year. Determine Santini's taxable income and income tax liability for 2023. Use Tax rate schedules and Exhibit 12-8. Note: Round your answers to the nearest whole dollar amount. > Answer is complete but not entirely correct. Description Taxable Income Income Tax Liability Amount $ 146,002 $ 26,612
Transcribed Image Text:Santini's new contract for 2023 indicates the following compensation and benefits: Salary Benefit Description Health insurance Restricted stock grant Bonus Hawaii trip Group-term life insurance Parking ($380 per month) Amount $ 142,500 21,500 2,500 7,500 6,500 4,100 4,560 Santini is 54 years old at the end of 2023. He is single and has no dependents. Assume that the employer matches $1 for $1 for the first $6,000 that the employee contributes to his 401(k) during the year. The restricted stock grant is 500 shares granted when the market price was $5 per share. Assume that the stock vests on December 31, 2023, and that the market price on that date is $70.00 per share. Also assume that Santini is willing to make any elections to reduce equity- based compensation taxes. The Hawaii trip was given to him as the outstanding salesperson for 2022. The group-term life policy gives him $150,000 of coverage. Assume that Santini does not itemize deductions for the year. Determine Santini's taxable income and income tax liability for 2023. Use Tax rate schedules and Exhibit 12-8. Note: Round your answers to the nearest whole dollar amount. > Answer is complete but not entirely correct. Description Taxable Income Income Tax Liability Amount $ 146,002 $ 26,612
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