Joe and Jessie are married and have one dependent child, Lizzie. Lizzie is currently in college at State University. Joe works as a design engineer for a manufacturing firm, while Jessie runs a craft business from their home. Jessie's craft business consists of making craft items for sale at craft shows that are held periodically at various locations. Jessie spends considerable time and effort on her craft business, and it has been consistently profitable over the years. Joe and Jessie own a home and pay interest on their home loan (balance of $220,000) and a personal loan to pay for Lizzie's college expenses (balance of $35,000). Neither Joe nor Jessie is blind or over age 65, and they plan to file as married joint. Assume that the employer portion of the self-employment tax on Jessie's income is $658. Joe and Jessie have summarized the income and expenses they expect to report this year as follows: Income: Joe's salary Jessie's craft sales Interest from certificate of deposit Interest from Treasury bond funds Interest from municipal bond funds Expenditures: Federal income tax withheld from Joe's wages State income tax withheld from Joe's wages Social Security tax withheld from Joe's wages Real estate taxes on residence Automobile licenses (based on weight) State sales tax paid $ 146,300 18,620 1,870 760 964 $ 13,700 6,840 7,570 6,640 354 1,370 28,200 2,740 1,910 2,840 6,680 173 Travel and lodging for craft shows 2,450 Self-employment tax on Jessie's craft income 1,316 College tuition paid for Lizzie 6,220 Interest on loans to pay Lizzie's tuition Lizzie's room and board at college Cash contributions to the Red Cross 3,640 13,060 635 Home mortgage interest Interest on Masterdebt credit card Medical expenses (unreimbursed) Joe's employee expenses (unreimbursed) Cost of Jessie's craft supplies Postage for mailing crafts a. Determine Joe and Jessie's AGI and taxable income for the year. Note: Round your intermediate calculations to the nearest whole dollar amount. Joe and Jessie's AGI Joe and Jessie's Taxable income
Joe and Jessie are married and have one dependent child, Lizzie. Lizzie is currently in college at State University. Joe works as a design engineer for a manufacturing firm, while Jessie runs a craft business from their home. Jessie's craft business consists of making craft items for sale at craft shows that are held periodically at various locations. Jessie spends considerable time and effort on her craft business, and it has been consistently profitable over the years. Joe and Jessie own a home and pay interest on their home loan (balance of $220,000) and a personal loan to pay for Lizzie's college expenses (balance of $35,000). Neither Joe nor Jessie is blind or over age 65, and they plan to file as married joint. Assume that the employer portion of the self-employment tax on Jessie's income is $658. Joe and Jessie have summarized the income and expenses they expect to report this year as follows: Income: Joe's salary Jessie's craft sales Interest from certificate of deposit Interest from Treasury bond funds Interest from municipal bond funds Expenditures: Federal income tax withheld from Joe's wages State income tax withheld from Joe's wages Social Security tax withheld from Joe's wages Real estate taxes on residence Automobile licenses (based on weight) State sales tax paid $ 146,300 18,620 1,870 760 964 $ 13,700 6,840 7,570 6,640 354 1,370 28,200 2,740 1,910 2,840 6,680 173 Travel and lodging for craft shows 2,450 Self-employment tax on Jessie's craft income 1,316 College tuition paid for Lizzie 6,220 Interest on loans to pay Lizzie's tuition Lizzie's room and board at college Cash contributions to the Red Cross 3,640 13,060 635 Home mortgage interest Interest on Masterdebt credit card Medical expenses (unreimbursed) Joe's employee expenses (unreimbursed) Cost of Jessie's craft supplies Postage for mailing crafts a. Determine Joe and Jessie's AGI and taxable income for the year. Note: Round your intermediate calculations to the nearest whole dollar amount. Joe and Jessie's AGI Joe and Jessie's Taxable income
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Joe and Jessie are married and have one dependent child, Lizzie. Lizzie is currently in college at State University. Joe
works as a design engineer for a manufacturing firm, while Jessie runs a craft business from their home. Jessie's craft
business consists of making craft items for sale at craft shows that are held periodically at various locations. Jessie spends
considerable time and effort on her craft business, and it has been consistently profitable over the years. Joe and Jessie
own a home and pay interest on their home loan (balance of $220,000) and a personal loan to pay for Lizzie's college
expenses (balance of $35,000).
Neither Joe nor Jessie is blind or over age 65, and they plan to file as married joint. Assume that the employer portion of
the self-employment tax on Jessie's income is $658. Joe and Jessie have summarized the income and expenses they
expect to report this year as follows:
Income:
Joe's salary
Jessie's craft sales
Interest from certificate of deposit
Interest from Treasury bond funds
Interest from municipal bond funds
Expenditures:
Federal income tax withheld from Joe's wages
State income tax withheld from Joe's wages
Social Security tax withheld from Joe's wages
Real estate taxes on residence
Automobile licenses (based on weight)
State sales tax paid
$ 146,300
18,620
1,870
760
964
$ 13,700
6,840
7,570
6,640
354
1,370
28,200
2,740
1,910
2,840
6,680
173
Travel and lodging for craft shows
2,450
Self-employment tax on Jessie's craft income
1,316
College tuition paid for Lizzie
6,220
Interest on loans to pay Lizzie's tuition
Lizzie's room and board at college
Cash contributions to the Red Cross
3,640
13,060
635
Home mortgage interest
Interest on Masterdebt credit card
Medical expenses (unreimbursed)
Joe's employee expenses (unreimbursed)
Cost of Jessie's craft supplies
Postage for mailing crafts
a. Determine Joe and Jessie's AGI and taxable income for the year.
Note: Round your intermediate calculations to the nearest whole dollar amount.
Joe and Jessie's AGI
Joe and Jessie's Taxable income
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