Discuss the possible outcomes of this situation considering his assets and the business assets.
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Chino is the sole proprietor of Kahit Saan Restaurant. COVID-19 pandemic came, his restaurant is no longer doing good and is on the verge of closing. Prior to pandemic, Chino secured a total Php 100,000.00 from various creditors to expand his restaurant operation. However, he is having a hard time paying his loans and creditors are running after him. Discuss the possible outcomes of this situation considering his assets and the business assets.
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- Hello! I need help with this problem. The first one is good, but the rest are wrong. Thank you for helping me. Problem 2-21 (LO. 1) Purple Company has $200,000 in net income for 2018 before deducting any compensation or other payment to its sole owner, Kirsten. Kirsten is single and she claims the $12,000 standard deduction for 2018. Purple Company is Kirsten's only source of income. Ignoring any employment tax considerations, compute Kirsten's after-tax income for each of the following situations. Click here to access the 2018 individual tax rate schedule to use for this problem. Assume the corporate tax rate is 21%. When required, carryout intermediate tax computations to the nearest cent and then round your final tax liability to the nearest dollar. a. If Purple Company is a proprietorship and Kirsten withdraws $50,000 from the business during the year; Kirsten claims a $40,000 deduction for qualified business income ($200,000 × 20%). Kirsten's taxable income is$, and her…Black operates a business. Black is single. The following information is available concerning his business related expenses during 2021: 1. A customer who owed $6,200 on open account filed for bankruptcy during 2021. It was estimated during 2021 that only $1,700 would eventually be collected from the customer during 2022. The account receivable had a basis of $6,200. 2. He incurred costs of $2,500 to appear before the city council to lobby for proposed legislation that had a direct effect upon his business. 3. He paid political contributions of $250 to a candidate for the city council. 4. He traveled to Paris on business for 6 days. The cost of airfare was $1,500. The cost of a hotel room was $250 per day. The cost of meals was $60 per day. Business was conducted on 5 days. He stayed the extra 1 day for a vacation. 5. He incurred entertainment expenses qualified business meals in the amount of $4,500 and entertainment expenses for attending the theater in the amount of $3,500. 6. He…Otis is the CEO of Bay Corp. The company has been struggling for the last few years and is in danger of defaulting on several of its bank loan covenants. Otis is facing significant pressure from the board of directors to turn the company around. Unless he meets all of the financial goals for the year, he will be out the door without a golden parachute. To improve the financial appearance of the company, Otis undertakes a scheme to boost the balance sheet by faking inventory. The analysis of what financial ratio would most likely bring this scheme to light? Inventory turnover Quick ratio Collection ratio Profit margin
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- The Carlson Department Store suffered heavy damage when a hurricane struck on August 31, 2013. The store was closed for four months (Sept – Dec 2013) and Carlson is now involved in a dispute with its insurance company concerning the amount of lost sales during the time the store was closed. Two key issues must be resolved: The amount of sales Carlson would have made if the hurricane had not struck; and Whether Carlson is entitled to any compensation for excess sales from increased business activity after the storm More than $8 billion in federal disaster relief and insurance money came into the county, resulting in increased sales at department stores and numerous other businesses. The table below shows the sales data for the 48 months preceding the storm. The following table reports total sales for the 48 months preceding the storm for all department stores in the county, as well as the total sales in the county for the four months the Carlson Department Store was closed. Management…Otis is the CEO of Bay Corp. The company has been struggling for the last few years and is in danger of defaulting on several of its bank loan covenants. Otis is facing significant pressure from the board of directors to turn the company around. Unless he meets all of the financial goals for the year, he will be out the door without a golden parachute. To improve the financial appearance of the company, Otis undertakes a scheme to boost the balance sheet by faking inventory. The analysis of what financial ratio would most likely bring this scheme to light? Inventory turnover Quick ratio Collection ratio Profit marginPrepare the closing entries for the following transactions. Natasha and Saher are living in Kabul as the humanitarian crisis looming in the country and the situation seems to be catastrophic due to a number of factors in the country’s poor economic condition including distorted trade in the country. They’ve decided to start up a small scale business which shall be financially sustainable and help people in the society who are suffering due to lack of food due to distorted trade in the country. After a lot of brainstorming and discussion, they decided to start the flour mill in the capital, which will be led by female and will support the female owned bakery business in the country. The following is the summary of the capital required to start their business an extract from their business plan that includes the NPV, IRR and payback period: Machinery (plant) and its setup cost: $65,000 Space with 10,000 square feet to rent. Their…
- In the past several years, Shakira had loaned money to Shakira Incorporated (an S corporation) to help the corporation keep afloat in a downturn. Her stock basis in the S corporation is now $0, and she has deducted $42,750 in losses, reducing her debt basis from $142,500 to $99,750. Things appear to be turning around this year, and Shakira Incorporated repaid Shakira $28,500 of the $142,500 outstanding loan. What is Shakira's income, if any, on the partial loan repayment?(b) Grouper' major customer shocked the industry on January 14 by declaring bankruptcy. There had been no warning to ANBS of this customer's impending financial collapse, and Grouper had not accrued any Allowance for Expected Credit Losses specific to this customer. At the end of the fiscal year, the customer owed more than $130,000 to Grouper. Identify the effect that it will have on Grouper's 2023 net income. Ignore taxes. Net income will ✓ by $15. In 2016, Tom loaned his friend Janelle $5,000 to invest in various stocks. Janelle signed a note to repay the principal with interest. In 2017, the stock market plunged and Janelle incurred large losses. In late 2017, Janelle declared personal bankruptcy and Tom was unable to collect any of the loan. Tom had no other gains or losses in 2016 or 2017. His income from wages in both 2016 and 2017 was $50,000. The result is: a. Tom deducts a business bad debt of $5,000 in 2016. b. Tom deducts a $5,000 capital loss in 2016. c. Tom deducts a business bad debt of $3,000 in 2016 and carries $2,000 over to subsequent years. d. Tom deducts a $3,000 capital loss in 2016 and carries $2,000 over to subsequent years. e. Tom must amend her 2015 tax return to deduct the loss.