Question

In: Accounting

Compute 2018 taxable income in each of the following independent situations.

Compute 2018 taxable income in each of the following independent situations.
a. Drew and Meg, ages 40 and 41, respectively, are married and file a joint return. In addition to four dependent children, they have AGI of $125,000 and itemized deductions of $27,000.
b. Sybil, age 40, is single and supports her dependent parents, who live with her. Sybil also supports her grandfather, who lives in a nursing home. She has AGI of $80,000 and itemized deductions of $8,000.
c. Scott, age 49, is a surviving spouse. His household includes two unmarried stepsons who qualify as his dependents. He has AGI of $75,000 and itemized deductions of $10,100.
d. Amelia, age 33, is an abandoned spouse and maintains a household for her three dependent children. She has AGI of $58,000 and itemized deductions of $10,650.
e. Dale, age 42, is divorced but maintains the home in which he and his daughter, Jill, live. Jill is single and qualifies as Dale’s dependent. Dale has AGI of $64,000 and itemized deductions of $9,900.

Solutions

Expert Solution

a. 

AGI                                                                                                            $125,000
Less: Itemized deductions                                                                         (27,000)
Taxable income                                                                                          $ 98,000

b. 

AGI                                                                                                              $80,000
Less: Standard deduction (head of household)                                     (18,000)
Taxable income                                                                                          $ 62,000

c. 

AGI                                                                                                              $75,000
Less: Standard deduction (surviving spouse)                                          (24,000)
Taxable income                                                                                           $51,000

d. 

AGI                                                                                                              $58,000
Less: Standard deduction (head of household)                                       (18,000)
Taxable income                                                                                           $40,000

e. 

AGI                                                                                                              $64,000
Less: Standard deduction (head of household)                                       (18,000)
Taxable income                                                                                           $46,000


a. Taxable income                                                                                          $ 98,000

b. Taxable income                                                                                          $ 62,000

c. Taxable income                                                                                           $ 51,000

d. Taxable income                                                                                            $ 40,000

e. Taxable income                                                                                             $ 46,000

Related Solutions

27.) Compute the taxable income for 2018 in each of the following independent situations: a.) Drew...
27.) Compute the taxable income for 2018 in each of the following independent situations: a.) Drew and Meg ages, 40 and 41, respectively are married and file a joint return. In addition to four dependent children, they have AGI 125,000 and itemized deductions of 27,000. b.)Sybil, age 40 is single and supports her dependent parents who live with her, as well as her grandfather who is in a nursing home. She has AGI of 80,000 and itemized deductions of 8,000...
Regarding the apportionment formula used to compute state taxable income, does each of the following independent...
Regarding the apportionment formula used to compute state taxable income, does each of the following independent characterizations describe a taxpayer that likely is based in-state or out-of-state? a. The sales factor is positively correlated with the payroll, but not the property, factor. b. The sales factor is much higher than the property and payroll factors. c. The property and payroll factors are much higher than those for other nexus states. d. The sales and payroll factors are low, but the...
What is income? in each of the following situations indicate whether taxable income should be recognized....
What is income? in each of the following situations indicate whether taxable income should be recognized. a) Q purchased an older home for 30,000. Shortly after its purchase, the area in which it was located was designated a historical neighborhood, causing its value to rise to 50,000 b) R, a long term employee of XYC, purchased one of the company's cars worth 7,000 for 3,000. c) I borrowed 10,000 secured by property that had an adjusted basis of 3,000 and...
Based on the amounts of taxable income below, compute the federal income tax payable in 2018...
Based on the amounts of taxable income below, compute the federal income tax payable in 2018 on each amount assuming the taxpayers are married filing a joint return. Also, for each amount of taxable income, compute the average tax rate and the marginal tax rate. a. Taxable income of $30,000 b. Taxable income of $100,000 c. Taxable income of $375,000 d. Taxable income of $700,000
In each of the following independent situations, determine the dividends received deduction for 2018. Assume that...
In each of the following independent situations, determine the dividends received deduction for 2018. Assume that Oak Corporation owns 25%, Elm owns 15% and Mahogany owns 80% of the stock in the corporations paying the dividends. Oak Corporation Elm Corporation Mahogany Corporation Income from operations $650,000 $900,000 $825,000 Expenses from operations (525,000) (850,000) (800,000) Qualifying dividends 100,000 100,000 100,000 a. The dividends received deduction for Oak Corporation is $ b. The dividends received deduction for Elm Corporation is $ c....
Determine taxable income in each of the following independent cases. In all cases, the company was...
Determine taxable income in each of the following independent cases. In all cases, the company was very profitable in all years prior to 2017 and it had retained earnings of $1,000,000 at the end of 2017. In 2018, Company A has taxable income of $60,000 prior to consideration of any net operating loss. In 2017, the Company incurred a net operating loss of $10,000. They did not elect to waive the carryback period. Determine 2018 taxable income. In 2018, Company...
Earned Income Credit: For each of the following situations, compute the taxpayers’ 2019 earned income credit....
Earned Income Credit: For each of the following situations, compute the taxpayers’ 2019 earned income credit. A. Patty and Ron Barnett file a joint return, claiming their two sons, ages 3 and 5, as dependents. The Barnett’s AGI is $14,400, which consists entirely of Ron’s wages. B. Joseph is a 25-year-old graduate student. His gross income consists of $5,000 of wages and $80 in interest from a savings account. Joseph files as single and claims no dependents. C. Suzanne and...
Compute the taxable SS benefits in the following situations: 1. Edward and Emily are married and...
Compute the taxable SS benefits in the following situations: 1. Edward and Emily are married and file a joint tax return. they have adjusted gross income of $46,000 no tax exempt interest, and $12,400 of SS benefits. 2. Edward and Emily have adjusted gross income of $12,000 no tax exempt interest, and $16,000 of SS benefits. 3. Edward and Emily have adjusted gross income of $85,000 no tax exempt interest and $15,000 of SS benefits. Please explained in a detailed...
Each of the following are independent situations. For each of the situations, use the 5-step process...
Each of the following are independent situations. For each of the situations, use the 5-step process to determine when revenue can be recognized by indicating for each of the situations: 1. If a contract exists 2. The performance obligations in the contract 3. The transaction price in the contract 4. How the transaction price is allocated to the performance obligations. 5. When revenue is recognized Situation A: Freddy Flyer books travel on an airline on June 2, 2027. He pays...
Determine the total allowable 2018 earned income credit in each of the following situations: a. Rina...
Determine the total allowable 2018 earned income credit in each of the following situations: a. Rina is single and earns $6,800 in salary for the year. In addition, she receives $2,200 in unemployment compensation during the year. b. Lachlan is single with one dependent child. During the year, he earns $8,000 as a waiter and receives alimony of $10,000 and child support of $5,000. c. Zorica is a single parent with two dependent children. She earns $19,000 from her job...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT