LYFT enters into an agreement with University to set up a $60K prepaid account balance to be used for student rides from University sporting events. University pays at the beginning of each month and the balance is drawn down as trips are completed during the month. The contract runs from 7/1/2019 to 12/31/2019.

a. What entry(ies) does LYFT record on the first day of the month for this transaction? How does the entry change if LYFT receives the cash on the first day versus if receives the cash on the last day of the month?

B. Assuming LYFT aggregates and books the trips against University's balance at month-end, what entry is recorded at the end of the month if only $30K in rides are taken? What entry is recorded if the $20K unused balance is refunded to University at the end of the month?

c. If the contract is set up that any usage beyond the $50K will be billed to University at the end of the month, what entry(ies) would be recorded at month end if $75K in rides were taken during the period?

d. If LYFT grants all students enrolled at University a 10% discount, what would the entry(ies) be to record a $10 student ride from a University sporting event?

e. If the University does not pay for 6 months but utilizes $100K in rides, how would this be reflected in the 12/31/2019 balance sheet? What P&L considerations would you have to assess?

LYFT enters into an agreement with University to set up a $60K prepaid account balance to be used for student rides from University sporting events. University pays at the beginning of each month and the balance is drawn down as trips are completed during the month. The contract runs from 7/1/2019 to 12/31/2019.

a. What entry(ies) does LYFT record on the first day of the month for this transaction? How does the entry change if LYFT receives the cash on the first day versus if receives the cash on the last day of the month?

B. Assuming LYFT aggregates and books the trips against University's balance at month-end, what entry is recorded at the end of the month if only $30K in rides are taken? What entry is recorded if the $20K unused balance is refunded to University at the end of the month?

c. If the contract is set up that any usage beyond the $50K will be billed to University at the end of the month, what entry(ies) would be recorded at month end if $75K in rides were taken during the period?

d. If LYFT grants all students enrolled at University a 10% discount, what would the entry(ies) be to record a $10 student ride from a University sporting event?

e. If the University does not pay for 6 months but utilizes $100K in rides, how would this be reflected in the 12/31/2019 balance sheet? What P&L considerations would you have to assess?

Q1- Ali, Betty, Carmel, Devaki and Eli are enthusiast stamp collectors and want to start an
online business that buys and sells historical collector-item stamps from around the world.
They decide to set up a company to do this. All four agree to put in $5,000 each to buy
shares in the company. Ali and Betty are assigned to put in an application to ASIC to register
a company called ‘Stamps R Us Pty Ltd’. Carmel is to look into getting a web design company
to design a website and get a quote. She visits Software Designs Pty Ltd in Parramatta CBD
and the salesman spends some time showing her various web design packages. Carmel is
very impressed with the ‘Super Delux’ package but is a little concerned about the $15,000
cost. The salesman informs her, however, that they currently have a 30 per cent sale on that
package, but that it finishes at 5 pm that day. Carmel excitedly calls Ali from the store, who
has been the driving force behind creating the business, to get his thoughts. He says ‘Yes.
Let’s do it’. Carmel signs the contract on behalf of both Stamps R Us and Ali, then and there.
Eli is assigned to investigate buying some stamps that the new company can have as stock
when it first launches. He visits his local stamp dealer, Charlie, of Charlie’s Stamps Pty Ltd,
who is very keen to get Eli’s business. Charlie tells Eli that if the new business buys stamps
from him worth over $10,000, he will give Eli a rare 1901 Australian Federation stamp, now
worth around $2,000 as a personal gift to show his appreciation. Eli is excited about this. He
contacts the group at their next meeting and they agree to buy $11,000 worth of stamps.
However, he doesn’t mention the personal gift. He goes ahead and buys the stamps and
receives the Federation stamp.
The following week, Ali and Betty’s application is successful and the company is registered.
All five become directors. However, at their first board meeting, Betty, Devaki and Eli are
unhappy about the cost of the website package and refuse to accept the contract, saying
the basic package would have been more than sufficient.
Advise the parties of their respective legal rights and liabilities.

Indicate how each of the following transactions is entered into the US balance of payments with double-entry bookkeeping:

• A U.S. firm exports $500 of goods to an Australian retired man who pays with his bank account savings from his Australian Bank

• A U.S. economics major purchases a travel service for $200 to Italy and pays it with money from his U.S. bank account

• The U.S. government gives $100 from a US bank to Cuba to favor greater economic growth

• A U.S. resident purchases a foreign stock for $400 and pays for it by increasing bank balances in the United States

• A foreign investor purchases $300 of U.S. treasury bills and pays by drawing down his bank balances in the United States by the same amount

--> Using this information, calculate the U.S. balance of payments

Example: Starbucks buys coffee from an Indonesian farmer for USD 50 K who in return acquires fertilizer from a US manufacturer

US Current Account (CA):

Trade: -50 K (import of coffee)

Trade: +50 K (export of fertilizer)

1. Alaska Airlines purchases its first Embraer jet from Embraer in Brazil for USD 65M. Embraer uses the receipt of USD 65M to reduce its outstanding USD loan with Bank of America in New York.

2. A Washington State farmer sells apples to a Canadian supermarket chain. The farmer is paid CAD 15M, which the farmer keeps in CAD in her bank account with a Canadian. Assume the spot exchange rate is 0.80 CAD/USD. Express your answer in USD at the current exchange rate.

On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
  

  
The company's chart of accounts follows:

  
Use the following information:

Two-thirds (or $133) of one month’s insurance coverage has expired.

At the end of the month, $600 of office supplies are still available.

This month’s depreciation on the computer equipment is $500.

Employees earned $420 of unpaid and unrecorded salaries as of month-end.

The company earned $1,750 of commissions that are not yet billed at month-end.

  
Required:
1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of April 30, 2017.
5b. Prepare the statement of retained earnings for the month of April 30, 2017.
5c. Prepare the balance sheet at April 30, 2017.
6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.

On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
  

  
The company's chart of accounts follows:

  
Use the following information:

Two-thirds (or $133) of one month’s insurance coverage has expired.

At the end of the month, $600 of office supplies are still available.

This month’s depreciation on the computer equipment is $500.

Employees earned $420 of unpaid and unrecorded salaries as of month-end.

The company earned $1,750 of commissions that are not yet billed at month-end.

  
Required:
1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of April 30, 2017.
5b. Prepare the statement of retained earnings for the month of April 30, 2017.
5c. Prepare the balance sheet at April 30, 2017.
6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.

1.Which statement best describes the U.S. framework for determining if an individual who is not a U.S. citizen will be treated as a resident alien for U.S. tax purposes?

Multiple Choice A person must have a green card and meet a substantial presence test to be treated as a resident alien for U.S. tax purposes. A person must have a green card to be treated as a resident alien for U.S. tax purposes. A person must meet a substantial presence test to be treated as a resident alien for U.S. tax purposes. A person with a green card will always be treated as a resident alien for U.S. tax purposes, while a person without a green card may be treated as a resident alien if she meets a substantial presence test.

2.

Boca Corporation, a U.S. corporation, reported U.S. taxable income of $1,000,000 in the current year. Boca also received a dividend of $100,000 from the corporation's 100 percent owned subsidiary in Italy. The dividend qualifies for the 100 percent dividends received deduction. The Italian government imposed a withholding tax of $5,000 on the dividend. Compute Boca Corporation's net U.S. tax liability for the current year.

Multiple Choice

• $231,000

• $227,000

• $210,000

• $205,000

3.

Which of the following foreign taxes is not creditable for U.S. tax purposes?

Multiple Choice

• Direct taxes paid by a U.S. corporation on income earned in a foreign branch.

• Income taxes paid to a foreign taxing authority on a dividend received by a U.S. corporation from its 100 percent owned foreign subsidiary.

• Withholding taxes imposed on a dividend received by a U.S. corporation from its 100 percent owned foreign subsidiary.

• All of these taxes are creditable.

4.

Orono Corporation manufactured inventory in the United States and sold the inventory to customers in Canada. Gross profit from the sale of the inventory was $300,000. Title to the inventory passed FOB: destination. How much of the gross profit is treated as foreign source income for purposes of computing the corporation's foreign tax credit in the current year?

Multiple Choice

• $300,000

• $150,000

• $0

• The answer cannot be determined with the information provided.

Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information: She received $132,000 in salary. She received $12,000 of dividend income. She received $4,100 of interest income on Home Depot bonds. She received $23,500 from the sale of Disney stock that was purchased 2 years prior to the sale at a cost of $5,000. She received $11,500 from the sale of Google stock that was purchased 6 months prior to the sale at a cost of $7,300. Mary receives one exemption ($4,000), and she has allowable itemized deductions of $7,500. These amounts will be deducted from her gross income to determine her taxable income.

Assume that her tax rates are based on Table 3.5. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below.

A. What is Mary's federal tax liability? Round your answer to the nearest cent. Do not round intermediate calculations.

B. What is her marginal tax rate? Round your answer to 1 decimal place.

C. What is her average tax rate? Round your answer to 2 decimal places.

Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information: She received $109,000 in salary.

She received $13,500 of dividend income.

She received $4,400 of interest income on Home Depot bonds.

She received $23,500 from the sale of Disney stock that was purchased 2 years prior to the sale at a cost of $6,000.

She received $9,000 from the sale of Google stock that was purchased 6 months prior to the sale at a cost of $4,500.

Mary receives one exemption ($4,000), and she has allowable itemized deductions of $7,500. These amounts will be deducted from her gross income to determine her taxable income. Assume that her tax rates are based on Table 3.5. The data has been collected in the Microsoft Excel Online file below.

Open the spreadsheet and perform the required analysis to answer the questions below.

Open spreadsheet What is Mary's federal tax liability? Round your answer to the nearest cent. Do not round intermediate calculations. $

What is her marginal tax rate? Round your answer to 1 decimal place. %

What is her average tax rate? Round your answer to 2 decimal places. %

Consider an individual who must drive to his place of work. Assume that there are 16 available hours in the day, that his wage rate is $20 per hour, and that he has nonlabour income of $100 per day. The commute takes one hour each day and it costs $40 in expenses for the round trip. Using a work-eisure diagram, depict his labour supply choice, including his reservation wage. Analyze the impact of an increase in commuting costs on his participation and hours decision. Analyze the impact, first of an increase in commuting time from two to four hours per day, and, second, of an increase in driving expenses from $40 to $60 per round trip, keeing commuting time at two hours.