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- Steven is an accountant and maintains an office in his home. Expenses of the business (other than home office expenses) are $15,000. Steven incurs the following home office expenses: Real property taxes on residence: $2,400 Interest expense on residence: $4,000 Operating expenses of residence: $3,200 Depreciation on residence (based on 8% business use): $450. His office occupies 10% of the total floor space of his residence. Gross income from his business is $34,000. Assuming that Steven uses the regular method, what is his allowable office in the home deduction?Morgan is 16 years old and works throughout the year at a local pizza place. This year, she made $4,890 at the pizza place and received $450 in interest income from her savings account. Assume Morgan's parents claim her as a dependent on their tax return. What is Morgan's standard deduction for the year? Enter your answer as a whole number. Omit dollar signs.Amy earns an income of 50,000 this year as an employee of rooster enterprises. She pays the following amounts during the year: Contribution to Traditional IRA : 5000 PreTax Cuts and Jobs Act Alimony she paid to her ex husband: 10,000 Medical expenses: 6000 What is Amy's Adjusted Gross Income? (AGI) a. 29000 b. 34000 c. 35000 d. 39000
- Bao and Mary Jane Lee have a yearly income of $93 comma 842 and own a house worth $127 comma 900, two cars worth a total of $ 28 comma 195 and furniture worth $14 comma 085. The house has a mortgage of $85 comma 677 and they have a car loan with an outstanding balance of $5 comma 822. Utility bills, totaling $181 for this month, have not been paid. Calculate their net worth, and explain what it means.Joe quits his computer programming job, where he was earning a salary of $60,000 per year, to start his own computer software business in a building that he owns and was previously renting out for $27,000 per year. In his first year of business he has the following expenses: salary paid to himself, $35,000; rent, $0; and other expenses, $25,000. Find the accounting cost and the economic cost associated with Joe's computer software business. (Enter numeric responses using an integer.) The accounting cost of Joe's business is $| -(Enter your response as an integer.)Mang Carlo is a balut vendor. For the taxable year year, he earned 180,000 from selling balut. Mang Carlo also operates a water refilling station. His income from this activity for the taxable year is 200,000. He also lends money to his neighbors and friends in which activity he earned 50,000 interest income for the taxable year. How much income is non-taxable? How much is the total income subject to regular income tax? How much income is subject to final tax?
- Ken is a self-employed architect in a small firm with four employees: himself, his office assistant, and two drafters, all of whom have worked for Ken full-time for the last four years. The office assistant earns $31,800 per year and each drafter earns $41,800. Ken’s net earnings from self-employment (after deducting all expenses and one-half of self-employment taxes) are $351,800. Ken is considering whether to establish a SEP plan and has a few questions. Assume that all the employees are at least 21 years old. If Ken is required to contribute for his employees and chooses to contribute the maximum amount, what is the maximum amount Ken can contribute for himself? (Hint: Calculate the employee amounts first.) Ignore any changes in Ken’s self-employment tax.Tony and Lyly are married during the tax year. Tony is a botanist at Red Corporation. Tony earns a salary of $70,000 per year. Lyly owns an accounting practice as a sole proprietor (it qualifies as a full trade or business). Lyly generates $100,000 of revenues during the year. She has the following business payments associated with her firm: Utilities: $2,000 Office Rent: $15,000 Office Supplies: $1,700 Self-employed health insurance premiums: $5,000 Self-Employment Tax (hers): $10,000 Salary for her secretary: $25,000 Fines/Penalties: $2,500 State Income Tax (from business): $6,000 Payroll Taxes (secretary’s): $2,000 Meals: $1,200 (100% for 2021) Payment to officer to let her go from speeding while on her way to a client meeting $100 Lyly also contributed $6,000 into her Traditional IRA. They also have the following personal expenses during the year: Medical Expenses: $17,500 State & Local Taxes (personal): $11,000 Federal Income Tax Payments (personal): $7,000 Cash…During the current year, Harry, a self-employed accountant, travels from Kansas City to Miami for a seven-day business trip. While in Miami, Harry decides to stay for an additional 5 days of vacation. Harry pays $600 for airfare, $200 for meals, and $500 for lodging while on business. The cost of meals and lodging while on vacation was $300 and $500, respectively. How much may Harry deduct as travel expenses for the trip? O $600 O $1,200 O None of the above O $1,100 O $1,300
- Briana owns a second home that he rents to others. During the year, she used the second home for 50 days for personal use and for 100 days for rental use. She collected $20,000 of rental receipts during the year. Based on the number of rental and personal days, she allocated $7,000 of interest expense and property taxes, $10,000 of other expenses, and $4,000 of depreciation expense to the rental use. What is her net rental income this year?Sandy and John Ferguson got married eight years ago and have a seven-year-old daughter, Samantha. In 2023, Sandy worked as a computer technician at a local university earning a salary of $153,500, and John worked part time as a receptionist for a law firm, earning a salary of $30,500. Sandy also does some Web design work on the side and reported revenues of $5,500 and associated expenses of $1,500. The Fergusons received $1,100 in qualified dividends and a $275 refund of their state income taxes. The Fergusons always itemize their deductions, get the full benefit of deducting the entire amount of state income taxes paid, and their itemized deductions were well over the standard deduction amount last year. Use Exhibit 8-10, Tax Rate Schedule, Dividends and Capital Gains Tax Rates, 2023 AMT exemption for reference. The Fergusons reported making the following payments during the year: • State income taxes of $4,775. Federal tax withholding of $21,000. • Alimony payments to Sandy's former…
