Financial Accounting Question Sarah started a catering business with the following transactions:Invested $40,000 into the business.Purchased kitchen equipment worth $7,000 on account.Sold catering services for $20,000; the cost to provide these services was$12,000.Paid utilities of $3,000.What is Sarah's net income after these transactions?

Step 1: Definition of Net IncomeNet income is the profit earned by a business, calculated as total…

Answered: Sarah started a catering business with…

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter3: Business Income And Expenses

Section: Chapter Questions

Problem 22MCQ

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[The following information applies to the questions displayed below.] Renee operates a proprietorship selling collectibles over the Web, and last year she purchased a building for $24 million for her business. This year, Renee's proprietorship reported revenue of $95.5 million and incurred total expenses of $88.6 million. Her expenses included cost of goods sold of $48.5 million, sales commissions paid of $16.9 million, $10.5 million of interest paid on the building mortgage, and $12.7 million of depreciation. c. Suppose that Renee's revenue includes $5 million of business interest income. What is the maximum amount of business interest expense that could be deducted this year under the business interest limitation? (Do not round intermediate calculations. Enter your answer in millions of dollar rounded to 2 decimal place.) Deductible Business Interest Expense $ 12.53 million
Roberto invested 18,000 in a chicken production operation. Using nonrecourse notes, the business purchases 120,000 worth of grain to feed the chickens. If Robertos share of the expense is 26,000, how much can he deduct?
Using the information below, determine Brian's Net Worth. Savings Account: $5,400, Checking Account: $3,000, Car Payment: $225/month for 12 months, Owns a 4-wheeler: $2,000, Riding Lawnmower: $1500, Laptop: $1,250, Rent. $650/month for 12 months, and Car Insurance: $95/month for 12 months.
Using the following information about the family’s assets and liabilities, calculate the total assets: Checking account: $3,000 Savings account: $13,000 Credit card balance: $5,500 Utility bill: $500 Home: $320,000 Mortgage (30 years): $210,000 Car: $25,000 Car loan (60 months): $18,000 Student loan (7 years): $25,000 Household items: $15,000 Retirement account: $64,000 Other assets: $39,000 A) 464,000 B) 400,000 C) 415,000 D) 479,000
Becky graduated with a master degree in Personal Financial Planning. After working two years in a small financial planning firm, Becky earns $70,870 annually and saves $12,418 a year. What is her average propensity to consume? (Keep 2 decimal places)
Lambda owns a checking account with a balance of $5,000, a savings account with a balance of $3,000, and will earn $70,000 as her salary every year. Based on this information only, Lambda's total financial assets equals: O $70,000 O $5,000 O $8,000 O $78,000

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