In the current year, Sandra rented her vacation home for 75 days, used it for personal use for 22 days, and left it vacant for theremainder of the year. Her income and expenses before allocation are as follows:Rental incomeReal estate taxesUtilitiesMortgage interestDepreciationRepairs and maintenanceRental incomeReal estate taxesRequired:What is Sandra's net income or loss from the rental of her vacation home? Use the Tax Court method.Note: Round your intermediate computations to 5 decimal places and final answers to nearest whole dollar value.UtilitiesMortgage interestRepairs and maintenance$ 15,0002,0001,5003,800DepreciationNet rental income,7,2001,300Schedule ESchedule A

If the owner of the house uses the house for more than 14 days or 10% of the days home was rented, the owner get stuck under the vacation rental income reporting rules.Here in our case Sandra used house for 22 days for personal use so she needs to follow vacation income reporting rules.We will tax court method where we are allowed to deduct(only mortgage interest & real state taxes) the allocable portion for the total days rented to the total days in the year.Computation of net income or loss from the rental of her vacation home Schedule E Schedule ARental income $15,000Real estate ($410.95890)(2,000×75/365)($1,589.04110)(2,000-410.95890)Utilities ($1,159.79381)($1,500×75/97)Mortgage interest ($780.82192)($3,800×75/365)($3,019.17809)($3,800- 780.82191)Depreciation ($5,567.01031)($7,200×75/97)Repairs and maintenance ($1,005.15464)($1,300×75/97)Net rental income $6,076.27042$4,608.21919Therefore net rental income in schedule E = $6,076.27042 or $6,076And in schedule A = $4,608.21919 or $4,608.

Business

Accounting

What is Sandra's net income or loss from the rental of her vacation home? Use the Tax Court method. Note: Round your intermediate computations to 5 decimal places and final answers to nearest whole dollar value. Rental income Real estate taxes Utilities Mortgage interest Repairs and maintenance Depreciation Net rental income Schedule E Schedule A

What is Sandra's net income or loss from the rental of her vacation home? Use the Tax Court method. Note: Round your intermediate computations to 5 decimal places and final answers to nearest whole dollar value. Rental income Real estate taxes Utilities Mortgage interest Repairs and maintenance Depreciation Net rental income Schedule E Schedule A

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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Subject : Accounting