Homework Help is Here – Start Your Trial Now!
Business
Accounting
What is the resort's net income for tax purposes?

What is the resort's net income for tax purposes?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
Question 21: Safe Haven Wildlife Resort operates a proprietorship that generated $200,000 in income under GAAP. The year end is December 31. Included in this amount are: • $65,000 rent expense paid for the resort • $24,000 for employee bonuses accrued at December 31, 2021| to be paid March 15, 2022 • $10,000 Accounting Loss on the Disposal of Capital Assets; and • $35,000 salary expense paid to the owner's son for cleaning the animal cages (40 hours a week for 6 weeks in summer) • Parking Tickets paid for salesperson staff while travelling on business $2,000 What is the resort's net income for tax purposes? A. $271,000 B. $280,000 C. Some other number D. $212,000 E. $247,000 Question 22: Jonah owns a local restaurant that generated $250,000 in income under GAAP. Included in this amount are: • $10,000 of depreciation expense • $33,000 repair and maintenance expenses for Jonah's principal residence • $166,000 salaries and wages for kitchen and restaurant staff $24,000 rent expense for the restaurant • $8,000 promotional expense sponsoring the local sports teams • The accountant calculated the maximum CCA as $15,000 for the year How much is Jonah's income for tax purposes? A. $286,000 B. $278,000 C. $316,000 D. $283,000
Transcribed Image Text:Question 21: Safe Haven Wildlife Resort operates a proprietorship that generated $200,000 in income under GAAP. The year end is December 31. Included in this amount are: • $65,000 rent expense paid for the resort • $24,000 for employee bonuses accrued at December 31, 2021| to be paid March 15, 2022 • $10,000 Accounting Loss on the Disposal of Capital Assets; and • $35,000 salary expense paid to the owner's son for cleaning the animal cages (40 hours a week for 6 weeks in summer) • Parking Tickets paid for salesperson staff while travelling on business $2,000 What is the resort's net income for tax purposes? A. $271,000 B. $280,000 C. Some other number D. $212,000 E. $247,000 Question 22: Jonah owns a local restaurant that generated $250,000 in income under GAAP. Included in this amount are: • $10,000 of depreciation expense • $33,000 repair and maintenance expenses for Jonah's principal residence • $166,000 salaries and wages for kitchen and restaurant staff $24,000 rent expense for the restaurant • $8,000 promotional expense sponsoring the local sports teams • The accountant calculated the maximum CCA as $15,000 for the year How much is Jonah's income for tax purposes? A. $286,000 B. $278,000 C. $316,000 D. $283,000
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Partners and Partnerships
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS