College Accounting (Book Only): A Career Approach
13th Edition
ISBN: 9781337280570
Author: Scott, Cathy J.
Publisher: South-Western College Pub
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Textbook Question
Chapter 1, Problem 3E
Dr. L. M. Patton is an ophthalmologist. As of December 31, Dr. Patton owned the following property that related to his professional practice, Patton Eye Clinic:
Cash, $2,995
Professional Equipment, $63,000
Office Equipment, $8,450
On the same date, he owed the following business creditors:
Munez Supply Company, $3,816
Martin Equipment Sales, $3,728
Compute the following amounts in the
Assets $______ = Liabilities $______ + Owner’s Equity $______
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Rita owns a sole proprietorship in which she works as a management consultant. She maintains an office in her home (500 square feet) where she meets with clients, prepares bills, and performs other work-related tasks. Her business expenses, other than home office expenses, total $5,720. The following home-related expenses have been allocated to her home office under the actual expense method for calculating home office expenses.
Real property taxes
$ 1,660
Interest on home mortgage
5,190
Operating expenses of home
830
Depreciation
1,636
Also, assume that, not counting the sole proprietorship, Rita's AGI is $61,200. Rita itemizes deductions, and her itemized deduction for non-home business taxes is less than $10,000 by more than the real property taxes allocated to business use of the home.
Assume Rita's consulting business generated $15,300 in gross income.
Note: Leave no answer blank. Enter zero if applicable.
Required:
What is Rita's home office deduction for the current…
Manji
Rita owns a sole proprietorship in which she works as a management consultant. She maintains an office in her
home (500 square feet) where she meets with clients, prepares bills, and performs other work-related tasks. Her
business expenses, other than home office expenses, total $6,060. The following home-related expenses have
been allocated to her home office under the actual expense method for calculating home office expenses.
Real property taxes
Interest on home mortgage
Operating expenses of home
$ 1,830
5,445
915
1,738
Depreciation
Also, assume that, not counting the sole proprietorship, Rita's AGI is $64,600. Rita itemizes deductions, and her
itemized deduction for non-home business taxes is less than $10,000 by more than the real property taxes
allocated to business use of the home.
Assume Rita's consulting business generated $16,150 in gross income. (Leave no answer blank. Enter zero if
applicable.)
d. Given the original facts, what types and amounts of expenses will she carry…
Chapter 1 Solutions
College Accounting (Book Only): A Career Approach
Ch. 1 - Prob. 1QYCh. 1 - Prob. 2QYCh. 1 - Which of the following accounts would increase...Ch. 1 - Which of the following statements is true? a....Ch. 1 - M. Parish purchased supplies on credit. What is...Ch. 1 - Define assets, liabilities, owners equity,...Ch. 1 - Prob. 2DQCh. 1 - How do Accounts Payable and Accounts Receivable...Ch. 1 - Describe two ways to increase owners equity and...Ch. 1 - What is the effect on the fundamental accounting...
Ch. 1 - When an owner withdraws cash or goods from the...Ch. 1 - Define chart of accounts and identify the...Ch. 1 - What account titles would you suggest for the...Ch. 1 - Prob. 1ECh. 1 - Determine the following amounts: a. The amount of...Ch. 1 - Dr. L. M. Patton is an ophthalmologist. As of...Ch. 1 - Describe a business transaction that will do the...Ch. 1 - Describe a transaction that resulted in each of...Ch. 1 - Label each of the following accounts as asset (A),...Ch. 1 - Describe a transaction that resulted in the...Ch. 1 - Describe the transactions that are recorded in the...Ch. 1 - On June 1 of this year, J. Larkin, Optometrist,...Ch. 1 - On July 1 of this year, R. Green established the...Ch. 1 - S. Davis, a graphic artist, opened a studio for...Ch. 1 - On March 1 of this year, B. Gervais established...Ch. 1 - In April, J. Rodriguez established an apartment...Ch. 1 - In July of this year, M. Wallace established a...Ch. 1 - In March, K. Haas, M.D., established the Haas...Ch. 1 - P. Schwartz, Attorney at Law, opened his office on...Ch. 1 - In March, T. Carter established Carter Delivery...Ch. 1 - In October, A. Nguyen established an apartment...Ch. 1 - Why Does It Matter? MACS CUSTOM CATERING, Eugene,...Ch. 1 - What Would You Say? A friend of yours wants to...Ch. 1 - Prob. 3A
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