Evelyn is single and a self-employed engineer. During 2018, Evelyn’s in-come from her engineering business is $55,000. Evelyn pays $3,100 for her Medi-Cal insurance policy.
a. How should the medical insurance policy payment be reflected on Evelyn’s 2018 return?
b. What is Evelyn’s 2018 self-employment tax deduction?
In: Accounting
Journalizing bond transactions
Power Company issued a $1,000,000, 5%, 5-year bond payable at face value on
January 1, 2018. Interest is paid semiannually on January 1 and July 1.
Requirements
1. Journalize the issuance of the bond payable on January 1, 2018.
2. Journalize the payment of semiannual interest on July 1, 2018.
In: Accounting
On May 5, 2018, Sarah purchased a new office building for $2.5 million to use for rental purposes. After review of the appraisal, $100,000 is allocated to the value of the land. On November 3, 2018, she began to lease office space in the building. On March 4, 2023, Sarah sold the building. What is Sarah's depreciation deduction for 2018 and 2023?
In: Accounting
Angela, Inc., holds a 90 percent interest in Corby Company. During 2017, Corby sold inventory costing $111,200 to Angela for $139,000. Of this inventory, $52,600 worth was not sold to outsiders until 2018. During 2018, Corby sold inventory costing $123,900 to Angela for $177,000. A total of $69,400 of this inventory was not sold to outsiders until 2019. In 2018, Angela reported separate net income of $237,000 while Corby's net income was $130,500 after excess amortizations.
What is the noncontrolling interest in the 2018 income of the subsidiary?
Multiple Choice
$174,500.
$173,300.
$214,200.
$183,200.
In: Accounting
During 2018, Karan acquired the following assets for use in her sole proprietorship: Asset Cost Date Place in ServiceComputers & Info. System $400,00003/31/2018Assembly Equipment1,200,00008/15/2018Warehouse 700,00011/13/2018
a. What is the maximum amount of cost recovery Karen can claim with respect to these assets in 2018?
b. What is each asset’s adjusted basis as of December 31, 2018?
c. Assume Karan sells the warehouse on May 5, 2020. What will Karan’s adjusted basis in the warehouse be for purposes of determining her gain or loss on the sale?
In: Accounting
On January 1, 2018, Hobart Mfg. Co. purchased a drill press at a cost of $39,300. The drill press is expected to last 10 years and has a residual value of $6,300. During its 10-year life, the equipment is expected to produce 500,000 units of product. In 2018 and 2019, 26,500 and 87,000 units, respectively, were produced. Required: Compute depreciation for 2018 and 2019 and the book value of the drill press at December 31, 2018 and 2019, assuming the units-of-production method is used. (Round depreciation per unit to 2 decimal places.)
In: Accounting
Weber resides in a state that imposes a tax on income. The
following information relating to Weber's state income taxes is
available:
| State income taxes withheld in 2018 | $3,000 |
| State sales taxes paid | $650 |
| Refund received in 2018 for 2017 tax | $300 |
| Assessment paid in 2018 for 2016 tax | $800 |
What amount should Weber use as state and local income taxes in
calculating itemized deductions for his 2018 Federal income tax
return?
a.$3,800
b.$3,500
c.$3,000
d.$2,700
e.None of these choices are correct.
In: Accounting
Al is a medical doctor who conducts his practice as a sole proprietor. During 2018, he received cash of $280,000 for medical services. Of the amount collected, $40,000 was for services provided in 2017. At the end of 2018, Al had accounts receivable of $60,000, all for services rendered in 2018. In addition, at the end of the year, Al received $12,000 as an advance payment from a health maintenance organization (HMO) for services to lx? rendered in 2019- Compute Al’s gross income for 2018:
a. Using the cash basis of accounting.
b. Using the accrual basis of accounting.
In: Accounting
At the beginning of 2018, Morley & Company had 560 units in inventory that were purchased at the following prices. Year purchased Units Cost per unit 2014 120 $100 2015 140 $110 2016 140 $115 2017 160 $120 During 2018 Morley was on strike, but the company sold 440 units of its products out of inventory. The cost that Morley would have incurred in manufacturing additional units during 2018 was $125. Assume the company uses the LIFO method for valuing inventories. The impact on 2018 pretax income of the decrease in inventory was:
In: Accounting
Ex. 18-134—Percentage-of-completion method. Penner Builders contracted to build a high-rise for €35,000,000. Construction began in 2018 and is expected to be completed in 2020. Data for 2018 and 2019 are:
2018 2019
costs incurred to date 4.5M 13M
Estimated cost to complete 18M. 12M
Penner uses the percentage-of-completion method.
Instructions
A: How much gross profit should be reported for 2018? Show your computation.
B: How much gross profit should be reported for 2019?
C: Make the journal Entry to record the revenue and gross profit for 2019
In: Accounting