During the year 2020, Mr. Ahmed purchased goods for $ 500, 000 and sold 3/5th of the goods for $ 500, 000 and met expenses amounting $ 150, 000. He counted net profit as $ 50, 000. Which of the accounting concept was followed by * ?him Entity O Matching O Periodicity O Conservatism O

During the year 2020, Mr. Ahmed purchased goods for $ 500, 000 and sold 3/5th of the goods for $ 500, 000 and met expenses amounting $ 150, 000. He counted net profit as $ 50, 000. Which of the accounting concept was followed by * ?him Entity O Matching O Periodicity O Conservatism O

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: ployment tax? B. Compute Wilma’s 2021 self-employment tax, assuming Wilma has no other earned…

A: Individuals are subject to self-employment taxes for security and medical expenses. It is charged at…

Q: For the following independent cases, determine whether economic income is present and, if so,…

A: Economic income is different from accounting income. Accounting income considers realized gains and…

Q: Hans runs a sole proprietorship. Hans has reported the following net §1231 gains and losses since he…

A: “Gain” refers to an increase in the profitable benefit, generally in the form of income or fresh…

Q: Gilbert purchased a home for $200,000 in 2012. For the last ten years, he has owned and used the…

A: Long-term capital gain refers to the amount that is being earned from selling the qualifying asset…

Q: James Jones is the owner of a small retail business operated as a sole proprietorship. During 2017,…

A: Given : Revenue from inventory sales $147,000 Cost of goods sold 33,500 Business license tax 2,400…

Q: On October 12, 2021, Max purchased one Bitcoin for $57,322. On December 19, 2021, he sold the…

A: When Max files his 2021 return, the sale of the Bitcoin on December 19, 2021 should be reported as a…

Q: Diane sold the following items during the current year: Item Holding Period…

A: When an individual disposes of the asset, he must compute the resulting gain or loss on such…

Q: Required information [The following information applies to the questions displayed below.] Hans runs…

A: Ordinary gain = Non recapture 1231 losses of previous 5 years which are offset by 1231 gain during…

Q: Rafael sold an asset to Jamal. What is Rafael's amount realized on the sale in each of the following…

A: Amount realized means the total amount of cash received by selling of an asset. It is calculated by…

Q: [The following information applies to the questions displayed below.] During the current year, Ron…

A: ParticularsShort-termLong-term OverallLong-term 28%Llong-term 25%Long-term Stock N 8,700.00…

Q: Peter carries on a retail business and sells substantial amounts of trading stock in his business.…

A: In the given question the trading stock in previous tax year was valued at $57000. The Stock at the…

Q: n the early part of 2024, the partners of Hugh, Jacobs, and Thomas sought assistance from a local…

A: More Explanation on how to arrive on the answer above First, allow's establish the Net Income for…

Q: During 2019, Tom sold Sears stock for $14,200. The stock was purchased 4 years ago for $19,880. Tom…

A: Net Gain is the difference between selling price and cost. Similarly, net loss is the difference…

Q: Seema is a resident individual, shares following information in relation to previous year Define…

A: GTI can be calculated by adding all heads of income such as Salary, House Property, Business or…

Q: Long-Term Capital Gain 11,000 Long-Term Capital Loss(74,700) After engaging in the appropriate…

A: Capital gain is nothing but the gain earned on the sale of a capital asset that is held by the owner…

Q: In the early part of 2021, the partners of Hugh, Jacobs, and Thomas sought assistance from a local…

A: It is a form of association which is originated and operated by two or more parties to run a…

Q: Hans runs a sole proprietorship. Hans has reported the following net §1231 gains and losses since he…

A: Income: Income includes all the income that belong to the taxpayer, both taxable and non-taxable.…

Q: Derek purchased a small business from Art on August 30, 2022. He paid the following amounts for the…

A: Intangible amortization refers to the process used for computing the cost of an asset as per the…

Q: Capital Asset L stock M stock N stock 0 stock Antiques Market Value $ 51,600 29,600 31,600 27,600…

A: Gross tax liability:The amount of total tax that is due to the government or the tax authority is…

Q: Ronald purchased a computer on March 4, 2023 for $3,200 for use in his accounting practice. How much…

A: MACRS provides a systematic way for businesses to recover the cost of their assets over time,…

Q: What is a Capital Asset?, Holding Period, Calculation of Gain or Loss, and Net Capital Gains (LO…

A: Definition of Short term capital Gain: If the Asset sold for profit having holding period of less…

Q: Margaret, a married taxpayer filing a joint return, engaged in two business activities this year.…

A: Business loss refers to an amount paid higher as expenses over the earnings earned during the…

Q: Determine Amos's gross income in each of the following cases: If an amount is zero, enter "0."…

A: To determine Amos's gross income in each of the provided scenarios, we need to apply the principles…

Q: The company’s treasurer and tax matters shareholder is a long time friend of yours. You have been…

A: Form 1120-S is the tax form to report the income, gains, losses, deductions, credits, etc., of a…

Q: ob purchased land as an investment on January 12, 2018, for $80,000. On January 31, 2021, Job sold…

A: Recognized gains and realized gains are two types of capital gains that indicate profits generated…

Q: Henrietta transfers cash of $312,400 and equipment with a fair market value of $93,720 (basis to her…

A: Gain is said to be realized gain when the investment market value is higher than the book value and…

Q: Rafael sold an asset to Jamal. What is Rafael's amount realized on the sale in each of the following…

A: GIVEN Refeel sold an asset to Jamal. What is Rafael's amount realized on the sale in each of the…

Q: During the current year, Ron and Anne sold the following assets: (Use the dividends and capital…

A: To calculate Ron and Anne's gross tax liability for 2023, we need to determine the capital gains tax…

Q: Georgie has gross in

A: Hobby income and expensesBeginning in 2018, the IRS doesn't allow you to deduct hobby expenses from…

Q: A taxpayer purchased land in 2010 for $92,000 and sold it in 2022 for $84,000 cash. The buyer also…

A: The objective of this question is to calculate the gain or loss on the sale of the land. The gain or…

Q: Ashburn reported a $105,150 net 1231 gain in year 6. Assuming Ashburn reported $57,000 of…

A: Ordinary income: It is the income earned by organization by its operations.

Q: Hans runs a sole proprietorship. Hans has reported the following net §1231 gains and losses since he…

A: b.) $40,900

Q: Required information [The following information applies to the questions displayed below] During the…

A: Capital Gain and LossThe amount earned on the sale of long-term assets like investment, tangible…

Q: Jessie purchased land as an investment on January 12, 2016 for $80,000. On January 31, 2021, Jessie…

A: Amount of the realized gain or loss on the sale = selling price + Mortgage value -purchase price

Q: During the 2019-2020 financial year, Tim James received a cash payment of $500,000 and goods worth…

A: Any amount of income earned by an assessee will be taxable under any one of the 5 heads of income…

Q: Hans runs a sole proprietorship. Hans has reported the following net §1231 gains and losses since he…

A: Income: Income includes all the income that belong to the taxpayer, both taxable and non-taxable.…

Q: acob purchased business equipment for $144,900 in 2018 and has taken $86,940 of regular MACRS…

A: Solution Given Cost of business 144900 Depreciation 86940 Sale price 65205…

Q: Accounting 1. Sally has the following for 2021: a $12,000 § 1245 gain a $38,000 § 1231 gain a…

A: In the context of the given question, we are required to compute the Ordinary gain or loss and…

Q: Rob Wriggle operates a small plumbing supplies business as a sole proprietor. In 2019, the plumbing…

A: Given Information: Marie wage income: $250,000 Gross business income: $421,000 Business expenses:…

Q: Your client (Irene) has provided you with the following information below. 2018 2019 2020 Losses are…

A: All amounts are in dollar.

Q: What is an individual’s adjusted net worth

A: The adjusted net worth is the worth of any person or a business for which the determination or…

Q: Required information [The following information applies to the questions displayed below.] During…

A: Taxes are a common method for redistributing income. By dispersing resources to benefit people with…

Q: In 2020, Cindy is married and files a joint return. She operates a sole proprietorship in which she…

A: An excess business loss is the sum by which total deductions from your businesses or trades are more…

Q: A family has a net worth of $165,000 and liabilities of $176,000. What is the amount of their…

A: Net worth can be defined as the accurate worth of an individual or an organization after adjusting…

Question

During the year 2020, Mr. Ahmed
purchased goods for $ 500, 000 and sold
3/5th of the goods for $ 50O, 000 and
met expenses amounting $ 150, 000. He
counted net profit as $ 50, 000. Which of
the accounting concept was followed by
* ?him
Entity O
Matching O
Periodicity O
Conservatism O

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Helena has the following long-term capital gains and losses for 2019: $94,000 28% gain, $75,200 28% loss, $42,300 25% gain, and $37,600 0%/15%/20% loss. She also has a $47,000 short-term loss and a $84,600 short-term gain. She has no other income. a. What is Helena’s AGI from these transactions? b. If she has a net long-term capital gain, what is its makeup in terms of the alternative tax rates?Helena has a net LTCG of ___________, all of which is 25% gain 37600 net STCG.
In the current year, Erin had the following capital gains (losses) from the sale of her investments: $2,900 LTCG, $24,100 STCG, ($9,900) LTCL, and ($15,900) STCL. What is the amount and nature of Erin's capital gains and losses? Multiple Choice $1,200 net short-term capital gain. $1,200 net long-term capital loss. $3,100 net short-term capital gain. $3,100 net long-term capital loss. None of the choices are correct.
The following information came from an IRS audit of a sole proprietor named John Doe. Using the “Cash T” approach, compute the probable over/understatement of income as computed by the IRS agent. Schedule C gross receipts ........................$112,610 Cost of goods sold ...................................... 65,414 Schedule C total cash expenses ................. 30,023 Rental income .........................................…. 5,318 Rental expenses (all cash) .....................….. 6,330 Beginning bank account balance ................. 7,873 Ending bank account balance ..................... 17,265 Insurance proceeds received (taxable) ……. 4,300 Principal payments on rental property loan… 2,894 Personal living expenses ............................. 26,550 Personal auto expenses ................................ 9,788 Social security benefits received …………….. 6,500 Gifts of cash received from relatives ……………
Thoren has the following items for the year: $4,000 of short-term capital gain, $5,000 of 0%/15%/20% long-term capital gain, and $1,500 of 28% capital loss. Which of the following is correct? a.The $1,500 loss will first be offset by the $5,000 long-term gain. b.The taxpayer will have a net short-term capital loss. c.The $1,500 loss will first be offset by the $4,000 short-term gain. d.The $4,000 short-term gain will first be offset by the $5,000 long-term gain.
[The following information applies to the questions displayed below.] During the current year, Ron and Anne sold the following assets: (Use the dividends and capital gains tax rates and tax rate schedules.) Capital Asset L stock M stock N stock 0 stock Antiques Rental home Market Value $ 50,600 28,600 30,600 26,600 7,600 300, 600* Tax Basis $ 41,300 39,600 22,300 33,600 4,300 90,300 Gross tax liability Holding Period > 1 year > 1 year 1 year > 1 year *$30,000 of the gain is 25 percent gain (from accumulated depreciation on the property). Ignore the Net Investment Income Tax. Given that Ron and Anne have taxable income of only $19,700 (all ordinary) before considering the tax effect of their asset sales, hat is their gross tax liability for 2023 assuming they file a joint return?
In July 2021, Cassie purchases equipment for $55,000 to be used in her business. Assuming Cassie has a small net loss from her business prior to the deduction, what is the maximum amount of cost recovery Cassie can deduct? a. $55,000 b. $7,860 c. $27,500 d. $31,430
Britta incurred the following capital gains and losses in 2019: Short-term capital gain $12,000 Short term capital loss ($19,000) Long term capital gain (28%) $5,000 Long term capital gain (25%) $12,000 Long term capital gain (0%/15%/20%) $17,000 Long term capital loss (0%/15%/20%) ($20,000) What is the net gain or loss Britta must recognize in 2019? Specify the character and tax rate that applies to the gain or loss. Please show your work.
Assume that Rosanne Madden, CPA, is using 5% of net incomebefore taxes, current assets, or current liabilities as her major guidelines for evaluatingmateriality. What qualitative factors should she also consider in deciding whethermisstatements may be material?
Rafael sold an asset to Jamal. What is Rafael's amount realized on the sale in each of the following alternative scenarios? c. Rafael received $20,000 cash, a parcel of land worth $50,000, and marketable securities of $10,000. Rafael also paid a commission of $8,000 on the transaction.
16. Wyatt Industries, an accrual-method and calendar year taxpayer, paid $12,000 in real estate taxes on October 1, 2021, covering the period October 1, 2021, to September 30, 2022. The amount of real estate taxes Wyatt can deduct as a business expense in 2021 is: a. b. C. d. e. $12,000. $6,000. $3,000. $0. none of the above.
Select the best answer. Which item of income has been constructively received by an individual taxpayer? O O O A. An increase in the value of stock owned estion Q 13 B. A check received for payment of services, but which has not yet been deposited C. Wages earned the last week of December but not paid until January of the following year O D. A line of credit available, but not yet drawn on Submit Answers 95% Complete
Last year, lana purchased a $100,000 account receivable for $90,000. During the current year, Lucy collected $97,000 on the account. What are the tax consequences to Lucy associated with the collection of the account receivable? No subsequent collections are expected. a.$7,000 gain b.$3,000 loss c.$13,000 loss d.$2,000 gain