Determine the effects of the following on a cash basis taxpayer's gross income for 2022 and 2023. If an amount is zero, enter "0".Gross Income2022Income2023a. On the morning of December 31, 2022, the taxpayer received a $1,500check from a customer. The taxpayer did not cash the check until January3, 2023.b. On the morning of December 31, 2022, the taxpayer received a $1,500check from a customer. The customer asked the taxpayer not to cash thecheck until January 3, 2023, after the customer's salary check could bedeposited.On December 31, 2022, the taxpayer received a $1,500 check from acustomer. The check was not received until after the bank had closed onDecember 31, 2022. The taxpayer did not cash the check until January 3,2023.GrossII10

Gross Income is the money earned before taxes and the other deductions are deducted. Earned income…

Answered: Determine the effects of the following…

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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A1
Required information [The following information applies to the questions displayed below.] Rebecca is a calendar-year taxpayer who operates a business. She made the following business-related expenditures in December of this year. Indicate the amount of these payments that she may deduct this year under both the cash method of accounting and the accrual method of accounting. (Leave no answers blank. Enter zero if applicable.) d. $1,500 for interest on a short-term bank loan relating to the period from November 1 of this year, through March 31 of next year. Deductible Amount Cash method Accrual method $ 0
Discussion Question 1-42 (Algorithmic) (LO. 5) Rita files her income tax return 120 days after the due date of the return without obtaining an extension from the IRS. Along with the return, she remits a check for $98,000, which is the balance of the tax she owes. Note: Assume 30 days in a month. Disregarding the interest element, enter Rita's failure to file penalty and failure to pay penalty. Failure to pay penalty $ Failure to file penalty X X
LO.2 Selma operates a contractor's supply store. She maintains her books using the cash method. At the end of 2023, her accountant computes her accrual basis income that is used on her tax return. For 2023, Selma had cash receipts of $1,400,000, which included $200,000 collected on accounts receivable from 2022 sales. It also included the proceeds of a $100,000 bank loan. At the end of 2023, she had $250,000 in accounts receivable from customers, all from 2023 sales. a. Compute Selma's accrual basis gross revenues for 2023. b. Selma paid cash for all of the purchases. The total amount paid for merchandise in 2023 was $1,300,000. At the end of 2022, she had merchandise on hand with a cost of $150,000. At the end of 2023, the cost of merchandise on hand was $300,000. Compute Selma's gross income from merchandise sales for 2023.
49. A taxpayer received the following items of income during the taxable year 2023: Interest income from BPI - Espana Branch from checking Interest income from BDO - Intramuros Branch from 62,000 Fom 38,500 account savings deposit Interest income from PNB - Quiapo Branch from foreign currency deposit account under the expanded currency deposit system Phone Calle Interest income from dollar deposit on Bank of New Jersey in the United States Interest income from promissory note of Mr. X, Philippines Paccy is Interest income from promissory note of Mr. X, United 612 States Yield from deposit substitute, Philippines Interest from Philippine government securities Interest income from long-term deposits, Philippines ub Interest income from long-term deposits, Egypt Royalties from books, Philippines Royalties from paintings, Philippines Royalties from musical compositions, Japan A. 300, 400 B. 312,900 C. 304,500 D. 362, 900 42,000 ebnuon 000.ce et nunu 000.20 130,000 58,400 Ismon es 62,000…
8. Youngstown Decking is an accrual basis taxpayer. On July 1, 2022, Youngstown paid $22,800 cash for a comprehensive liability and property insurance policy that covers a 24-month period. The deduction for insurance expense for 2022 is: a.$11,400. b.$22,800. c.$6,650. d.$5,700. e.$950.
24. As a newly hired IRS trainee, you have been asked to calculate the amount of tax refund or tax owed for the taxpayer (in $). (Enter a positive value for the amount.) Name TaxLiability TaxCredits OtherTaxes Payments Refund/Owe(Select one) Amount Trent $5,798 $1,331 $875 $6,700 $
Compute the penalty described for the following taxpayers. If an amount is zero, enter "0". If required, round your answers to two decimal places. Question Content Area a. Wilson filed his individual tax return on the original due date, but failed to pay $2,310 in taxes that were due with the return. If Wilson pays the taxes exactly 3 months late (not over 60 days), calculate the amount of his failure-to-pay penalty.$fill in the blank b. Joan filed her individual income tax return 5 months after it was due. She did not request an extension of time for filing. Along with her return, Joan remitted a check for $725, which was the balance of the taxes she owed with her return. Disregarding interest, calculate the total penalties that Joan will be required to pay, assuming the failure to file was not fraudulent.$fill in the blank
n 2021 Betty loaned her son, Juan, $10,000 to help him buy a car. In 2023, before he repaid the $10,000, Betty to Juan that she was "tearing up" the $10,000 note as a graduation present. How should Juan treat the amount forgi O A. taxable income in year of forgiveness B. excludible gift in year of forgiveness OC. taxable income in year of loan O D. excludible gift in year of loan
Required information [The following information applies to the questions displayed below.] In January of year 0, Justin paid $8,800 for an insurance policy that covers his business property for accidents and casualties. Justin is a calendar-year taxpayer who uses the cash method of accounting. What amount of the insurance premium may Justin deduct in year O in each of the following alternative scenarios? Note: Leave no answers blank. Enter zero if applicable. d. Instead of paying an insurance premium, Justin pays $8,800 to rent his business property from April 1 of year 0 throug March 31 of year 1. Deductible amount
LSG Company is a calendar year, cash basis taxpayer. On November 1, 2021, LSG paid $9,450 to the janitorial service that cleans their offices. How much of this expenditure can LSG deduct in 2021 assuming that: The expenditure is a prepayment for 6 months of cleaning services from November 2021 through April 2022? _____________________________________________________________________________________ _____________________________________________________________________________________ The expenditure is a prepayment for 18 months of cleaning services from November 2021 through April 2023? _________
Clyde is a cash-method taxpayer who reports on a calendar-year basis. This year Paylate Corporation has decided to pay Clyde a year-end bonus of $1,450.Determine the amount Clyde should include in his gross income this year under the following circumstances. (Leave no answer blank. Enter zero if applicable.) Problem 5-53 Part-d (Algo) d. Clyde picked up the check in December, but the check could not be cashed immediately because it was postdated January 10. Amount to be included in gross income - ________

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