Problem 11-37 (LO. 7) Alex, who is single, conducts an activity in 2019 that is classified...

Problem 11-37 (LO. 7)

Alex, who is single, conducts an activity in 2019 that is classified as a hobby. The activity produces the following revenues and expenses.

Revenue	$18,000
Property taxes	3,000
Materials and supplies	4,500
Utilities	2,000
Advertising	5,000
Insurance	750
Depreciation	4,000

Without regard to this hobby, Alex's AGI is $42,000.

Determine the amount of gross income that Alex must report and the amount of expenses he is permitted to deduct. Assume Alex itemizes his deductions.

Reportable income: $
Deductible expenses: $

Solutions

Expert Solution

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Problem 11-37 (LO. 7) Alex, who is single, conducts an activity in 2019 that is classified...

Problem 11-37 (LO. 7) Alex, who is single, conducts an activity in 2019 that is classified as a hobby. The activity produces the following revenues and expenses. Revenue $18,000 Property taxes 3,000 Materials and supplies 4,500 Utilities 2,000 Advertising 5,000 Insurance 750 Depreciation 4,000 Without regard to this hobby, Alex's AGI is $42,000. Determine the amount of gross income that Alex must report and the amount of expenses he is permitted to deduct. Assume Alex itemizes his deductions. Reportable income:...

Alex, who is single, conducts an activity in 2019 that is classified as a hobby. The...

Alex, who is single, conducts an activity in 2019 that is classified as a hobby. The activity produces the following revenues and expenses. Revenue $18,000 Property taxes 3,000 Materials and supplies 4,500 Utilities 2,000 Advertising 5,000 Insurance 750 Depreciation 4,000 Without regard to this hobby, Alex's AGI is $42,000. Determine the amount of gross income that Alex must report and the amount of expenses he is permitted to deduct. Assume Alex itemizes his deductions. Reportable income: $ Deductible expenses: $

Alex, who is single, conducts an activity in 2019 that is appropriately classified as a hobby....

Alex, who is single, conducts an activity in 2019 that is appropriately classified as a hobby. The activity produces the following revenues and expenses: Revenue - $18,000, Property Taxes - $3,000, Materials and supplies - $4,500, Utilities - $2,000, Advertising - $5,000, Insurance - $750, Depreciation - $4,000. Without regard to this activity, Alex's AGI is $42,000. Determine the amount of income Alex must report and the amount of the expenses he is permitted to deduct. Assume Alex itemizes his...

Alex, single, earns wags of $42,000 in 2026. He also conducts an activity that produces the...

Alex, single, earns wags of $42,000 in 2026. He also conducts an activity that produces the following revenues and expenses: Revenues $18,000 Expenses Property taxes 3,000 Materials and supplies 4,500 Utilities 2,000 Advertising 5,000 Insurance 750 Cost Recovery 8,000 Alex also pays mortgage interest during the year of $8,000. Assume Congress passes no new tax laws between now and 2026 and that there are no relevant inflation adjustments. 1. Assuming the activity is a business, Alex' 2026 AGI is $...

Problem 10-37 (Algorithmic) (LO. 6, 7, 8, 9, 10, 11) Amy and Mitchell share equally in...

Problem 10-37 (Algorithmic) (LO. 6, 7, 8, 9, 10, 11) Amy and Mitchell share equally in the profits, losses, and capital of the accrual basis AM Products LLC. The LLC does not need to report financial information to any third parties, so capital accounts are determined using tax rules (rather than GAAP). Amy is a managing member of the LLC (treated as a general partner) and is a U.S. person. At the beginning of the current tax year, Amy's capital...

Problem 11-26A Analyzing the stockholders' equity section of the balance sheet LO 11-2, 11-3, 11-7 The...

Problem 11-26A Analyzing the stockholders' equity section of the balance sheet LO 11-2, 11-3, 11-7 The stockholders’ equity section of the balance sheet for Mann Equipment Co. at December 31, Year 1, is as follows Stockholders’ Equity Paid-in capital Preferred stock, ? par value, 4% cumulative, 240,000 shares authorized, 54,000 shares issued and outstanding $ 540,000 Common stock, $30 stated value, 290,000 shares authorized, 54,000 shares issued and outstanding 1,620,000 Paid-in capital in excess of par—Preferred 44,000 Paid-in capital in...

Problem 7-45 (LO. 7) Xinran, who is married and files a joint return, owns a grocery...

Problem 7-45 (LO. 7) Xinran, who is married and files a joint return, owns a grocery store. In 2018, his gross sales were $276,000, and his operating expenses were $320,000. Other items on his 2018 return were as follows: Nonbusiness capital gains (short-term) $20,000 Nonbusiness capital losses (long-term) 9,000 Itemized deductions 18,000 Ordinary nonbusiness income 8,000 Salary from part-time job 10,000 In 2019, Xinran provides the following information: Net business income $60,000 Salary (spouse) 25,000 Interest income 2,000 Adjusted gross...

U.S Tax law with 2019 revisions: Problem 7-7 Earned Income Credit (LO 7.2) Margaret and David...

U.S Tax law with 2019 revisions: Problem 7-7 Earned Income Credit (LO 7.2) Margaret and David Simmons are married and file a joint income tax return. They have two dependent children, Margo, 5 years old (Social Security number 316-31-4890), and Daniel, who was born during the year (Social Security number 316-31-7894). Margaret's wages are $3,000, and David has wages of $14,000. In addition, they receive interest income of $200 during the year. Margaret and David do not have any other...

Alex, who is single and works as a caddie at a country club, ask you to...

Alex, who is single and works as a caddie at a country club, ask you to help her calculate her tax liability. She tells you about the following transactions: She earned $32,000 in wages from the country club, $1,000 of interest income from a savings account. In addition, Alex had a $5,000 L/T capital loss carry forward and gained $20,000 on the sale of a stock. Alex purchased the shares on insider information (an illegal activity) and owned for stock 5 days....

Problem 7-10 Child and Dependent Care Credit (LO 7.3) Clarita is a single taxpayer with two...

Problem 7-10 Child and Dependent Care Credit (LO 7.3) Clarita is a single taxpayer with two dependent children, ages 10 and 12. Clarita pays $3,000 in qualified child care expenses during the year. TABLE 6.1 CHILD AND DEPENDENT CARE CREDIT PERCENTAGES Adjusted Gross Income Applicable Percentage Over But Not Over $0 – $15,000 35% 15,000 – 17,000 34% 17,000 – 19,000 33% 19,000 – 21,000 32% 21,000 – 23,000 31% 23,000 – 25,000 30% 25,000 – 27,000 29% 27,000 –...

Subjects