Mrs. V paid the following expenditures in the current year.Interest on line of credit ($20,000 outstanding for the entire year)Investment management fees for her registered retirement savings planInvestment management fees for her non-registered investmentsLegal fees related to the acquisition of a rental property$1,550$1,000The line of credit is mostly for the purchase of non-registered investments, made several years ago. All of the investments are still owned. However, $5,000 of the total outstanding principal was used to renovate her home last year.O $1,8006,000The rental property was purchased late in the year. No rental income was received in the year.O $2,750800What is the total amount that she can deduct on her personal income tax return for the current year, in respect of these expenditures?O $3,0001,200

The objective of the question is to determine the total amount that Mrs. V can deduct on her…

Answered: Mrs. V paid the following expenditures…

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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During the current year, Hom donates a sculpture that cost $1,000 to a museum for exhibition. The sculpture's fair market value was $1,700 on the date of the donation, and Hom's adjusted gross income is $40,000. Assume Hom held the sculpture for 4 months and the $700 ($1,700 − $1,000) of appreciation is a short-term capital gain. Calculate the amount of his itemized deduction for the contribution. Assume Hom held the sculpture for 2 years and the $700 appreciation is a long-term capital gain. Calculate the amount of his itemized deduction for the contribution.
4. Shane obliged to pay her liability to St. Sebastian Multipurpose Cooperative amounting to 875,000.00 which she used to purchase a parcel of land. The interest for her debt is 6.2 % compounded quarterly for 3 years. Construct an amortization schedule to terminate the said obligation.
The executor of Rose Shield’s estate listed the following properties (at fair value): Prepare journal entries to record the property held by Ms. Shield’s estate and then each of the following transactions that occur in the months following the decedent’s death: Claims of $80,000 are made against the estate for various debts incurred before the decedent’s death. Interest of $12,000 is received from bonds held by the estate. Of this amount, $5,000 had been earned prior to death. Ordinary repairs costing $6,000 are made to the rental property. All debts ($80,000) are paid. Stocks recorded in the estate at $16,000 are sold for $19,000 cash. (Rental income of $14,000 is collected. Of this amount, $2,000 had been earned prior to the decedent’s death. (7) Cash of $6,000 is distributed to Jim Arness, an income beneficiary. The proceeds from the life insurance policy are collected and the money is immediately distributed to Amanda Blake as specified in the decedent’s will. Funeral expenses…
29 Leonard withdrew $10,000 from his RRSP under the Home Buyers' Plan on August 12th of last year and used the amount as a deposit on the purchase of a new house. However, he realized that he needed another $8,000 to help finance the downpayment and made a second HBP withdrawal on September 25th of last year. He will take possession of the property on April 1st of this year. On January 20th of this year, he withdrew another $7,000 under the HBP to buy some appliances. Based on his withdrawals, how much does Leonard have to include as taxable income? a) $0 b) $5,000 c) $7,000 d) $15,000
The executor of Rose Shield's estate listed the following properties (at fair value): Cash $ 300,000 Life insurance receivable 200,000 100,000 Investments in stocks and bonds Rental property 90,000 Personal property 130,000 Following are the transactions that occur in the months following the decedent's death: (1) Claims of $80,000 are made against the estate for various debts incurred before the decedent's death. (2) Interest of $12,000 is received from bonds held by the estate. Of this amount, $5,000 had been earned prior to death. (3) Ordinary repairs costing $6,000 are made to the rental property. (4) All debts ($80,000) are paid. (5) Stocks recorded in the estate at $16,000 are sold for $19,000 cash. (6) Rental income of $14,000 is collected. Of this amount, $2,000 had been earned prior to the decedent's death. (7) Cash of $6,000 is distributed to Jim Arness, an income beneficiary. (8) The proceeds from the life insurance policy are collected and the money is immediately…
Barbara sold land she purchased three months earlier for use in her business. Her cost and adjusted basis in the land prior to the sale were $80,000. She also incurred $10,000 in expenses related to the sale. The buyer paid $80,000 cash and assumed barbarous 20,000 mortgage on the property. What is the amount of Barbara's gain, and where on form 4797 will she report the sale?
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The terms of a will currently undergoing probate are: “A gift to my brother Chris of $40,000 cash; to my son Eric, $75,000 from my Redstone Savings Bank account; and to my daughter Lauryn, all of my remaining property.” At the time of death, the balance in the savings account was $60,000, and there was additional cash (after payment of funeral expenses and all claims against the estate) of $95,000. The gift to Chris is a
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Ff.277.
As to Principal I charge myself with: Assets subsequently discovered: Total charges I redit myself with: Estate principal Estate principal: Estate principal As to Income I charge myself with: I credit myself with: Balance as to income Balance as to income:
During the current year, Finn and Claire, a married couple who use the cash method of accounting purchased a principal residence for $325,000. They paid $39,000 down and financed the remaining $286,000 of the purchase price with a 30-year mortgage. At the closing, they also paid $350 for an appraisal, $425 for a title search, and 2.5 points representing additional interest over the term of the loan. At the end of the year, Finn and Claire received a statement from the mortgage company indicating that $11,500 of their total monthly payments made during the year represents interest and $1,100 is a reduction of the principal What is the total amount Finn and Claire may deduct in the current year arising from the purchase and ownership of their home? Finn and Claire may deduct . Part 2 b. What is the treatment of the other items that are not deductible? A. The other closing costs are added to the market value of the home. B. The other closing…

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