Note: This problem is for the 2019 tax year.

Roberta Santos, age 41, is single and lives at 120 Sanborne Avenue, Springfield, IL 60781. Her Social Security number is 123-45-6780. Roberta has been divorced from her former husband, Wayne, for three years. She has a son, Jason, who is 17, and a daughter, June, who is 18. Jason's Social Security number is 111-11-1112, and June's is 123-45-6788. Roberta has never owned or used any virtual currency. She does not want to contribute $3 to the Presidential Election Campaign Fund.

Roberta, an advertising executive, earned a salary from ABC Advertising of $80,000 in 2019. Her employer withheld $9,000 in Federal income tax and $3,100 in state income tax.

Roberta has legal custody of Jason and June. The divorce decree provides that Roberta is to receive the dependency deductions for the children. Jason lives with his father during summer vacation. Wayne indicates that his expenses for Jason are $5,500. Roberta can document that she spent $6,500 for Jason's support during 2019. In prior years, Roberta gave a signed Form 8332 to Wayne regarding Jason. For 2019, she has decided not to do so. Roberta provides all of June's support.

Roberta's mother died on January 7, 2019. Roberta inherited assets worth $625,000 from her mother. As the sole beneficiary of her mother's life insurance policy, Roberta received insurance proceeds of $300,000. Her mother's cost basis for the life insurance policy was $120,000. Roberta's favorite aunt gave her $13,000 for her birthday in October.

On November 8, 2019, Roberta sells for $22,000 Amber stock that she had purchased for $24,000 from her first cousin, Walt, on December 5, 2013. Walt's cost basis for the stock was $26,000, and the stock was worth $23,000 on December 5, 2015. On December 1, 2019, Roberta sold Falcon stock for $13,500. She had acquired the stock on July 2, 2015, for $8,000.

An examination of Roberta's records reveals that she received the following:

Interest income of $2,500 from First Savings Bank.

Groceries valued at $750 from Kroger Groceries for being the 100,000th customer.

Qualified dividend income of $1,800 from Amber.

Interest income of $3,750 on City of Springfield school bonds.

Alimony of $16,000 from Wayne; divorce finalized in May 2015.

Distribution of $4,800 from ST Partnership. Her distributive share of the partnership passive taxable income was $5,300. She had no prior passive activity losses. Assume that the qualified business income deduction applies and the W–2 wage limitation does not.

From her checkbook records, she determines that she made the following payments during 2019:

Charitable contributions of $4,500 to First Presbyterian Church and $1,500 to the American Red Cross (proper receipts obtained).

Paid $5,000 to ECM Hospital for the medical expenses of a friend from work.

Mortgage interest on her residence of $7,800 to Peoples Bank.

Property taxes of $3,200 on her residence and $1,100 (ad valorem) on her car. $800 for landscaping expenses for residence.

Estimated Federal income taxes of $2,800 and estimated state income taxes of $1,000.

Medical expenses of $5,000 for her and $800 for Jason. In December, her medical insurance policy reimbursed $1,500 of her medical expenses. She had full-year health care coverage.

A $1,000 ticket for parking in a handicapped space.

Attorney's fees of $500 associated with unsuccessfully contesting the parking ticket.

Contribution of $250 to the campaign of a candidate for governor.

Because she did not maintain records of the sales tax she paid, she calculates the amount from the sales tax table to be $994.

Required:

Calculate Roberta's net tax payable or refund due for 2019.

Enter all amounts as positive numbers. However, use the minus sign to indicate a loss.

If an amount box does not require an entry or the answer is zero, enter "0".

Make realistic assumptions about any missing data. I

t may be necessary to complete the tax schedules before completing Form 1040.

When computing the tax liability, do not round your immediate calculations. If required round your final answers to the nearest dollar.

Use the Tax Rate Schedule provided. Do not use the Tax Tables.

The following information was taken from the records of Vega Inc. for the year 2015: income tax applicable to income from continuing operations R$119,000, income tax applicable to loss on discontinued operations R$25,500, and unrealized holding gain on non-trading equity securities R$15,000.

Ordinary shares outstanding during 2015 were 100,000.

Requirement:

1. Prepare a comprehensive income statement for 2015 using the one statement approach

2. Prepare a retained earnings statement for 2015.

Margaret has a project with a £ 26,000 first cost that returns £ 4,800 per year over its 10-year life. It has salvage value of £ 3,400 at the end of 10 years. If the MARR is 14 %, (Use 5 significant figures for your calculations, and round your answers to the nearest dollar. Indicate losses as a negative value.)

(a) What is the present worth of this project?

(b) What is the annual worth of this project?

(c) What is the future worth of this project after 10 years?

Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $2 reduction in the selling price. The company’s present selling price is $98 per unit, and variable expenses are $68 per unit. Fixed expenses are $832,800 per year. The present annual sales volume (at the $98 selling price) is 25,200 units.

Required:

1. What is the present yearly net operating income or loss?

2. What is the present break-even point in unit sales and in dollar sales?

3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many units and at what selling price per unit would the company generate this profit?

4. What would be the break-even point in unit sales and in dollar sales using the selling price you determined in (3) above (e.g., the selling price at the level of maximum profits)?

A new booster machine will cost $480,000. The anticipated increase in revenue will be $140,000/year for 5-years. Annual expenses will be $30,000/year for 5-years. The depreciable life is estimated to be 5-years and the salvage value will equal $35,000. Additional inventory necessary to run the machine will be $26,000. Initial training expenses are $20,000. Tax rate equals 40%.

 Find the NPV@10%.

 Find the IRR.

 Find the discounted payback and convert this into a percentage.

A three-year project will cost $150,000 to construct. This will be depreciated straight line to zero over the three-year life. The project is expected to generate sales of $450,000 per year. It has annual variables costs of $200,000 and annual fixed costs of $100,000 per year. The appropriate tax rate is 25 percent and the required rate of return on the project is 16 percent. Assume that a salvage company will pay $60,000 (before taxes) for the assets at the end of year 3. The project also has an initial net working capital requirement of $40,000, which is fully recoverable when the project ends. Note that the project only depreciates the $150,000 initial cost. The salvage value is excluded from depreciation. What is the project’s net present value (NPV)

In a recent school year in the state of Washington, there were 319,000 high school students. Of these, 154,000 were girls and 165,000 were boys. Among the girls, 41,100 dropped out of school, and among the boys, 10,500 dropped out. A student is chosen at random. Round the answers to four decimal places.

(a) What is the probability that the student is female?

(b) What is the probability that the student dropped out?

(c) What is the probability that the student is female and dropped out?

(d) Given that the student is female, what is the probability that she dropped out?

(e) Given that the student dropped out, what is the probability that the student is female?

The Aluminum Association reports that the average American uses 56.8 pounds of aluminum in a year. A random sample of 51 households is monitored for one year to determine aluminum usage. If the population standard deviation of annual usage is 12.4 pounds, what is the probability that the sample mean will be each of the following?

Appendix A Statistical Tables

a. More than 59 pounds
b. More than 57 pounds
c. Between 55 and 58 pounds
d. Less than 54 pounds
e. Less than 49 pounds

(Round the values of z to 2 decimal places. Round your answers to 4 decimal places.)

a. enter the probability that the sample mean will be more than 59 pounds

b. enter the probability that the sample mean will be more than 57 pounds

c. enter the probability that the sample mean will be between 55 and 58 pounds

d. enter the probability that the sample mean will be less than 54 pounds

e. enter the probability that the sample mean will be less than 49 pounds

a borrower takes out a 15 year mortgage loan for 100,000 with an interest rate of 5% plus 3 points. what is the effective annual interest rate on the loan if the loan is carried 15 years.

You purchase a 10 year bond with an annual fixed coupon rate of 7% and a par value of $1,000, when the yield to maturity on such bonds is 6%. You hold the bond for a year and then sell it. Assume the yield to maturity on the bond falls to 5.5% by the time you sell. What is your holding period return?