At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $15,600 and accumulated E&P of $20,750 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $20,750 distribution (the remaining shareholders received $31,125 in distributions). (Assume her stock basis is $41,500 after considering her share of Bombay’s income for the year but before considering the effects of the distribution.) Required: What is the amount and character of gain Nicolette must recognize from the distribution? What is her basis in her Bombay stock at the end of the year?

Reggie takes a loan for 5 years to be repaid by level end of year payments of R. The interest paid in the third payment was 136.16 and the interest paid in the 5^th payment was 47.62. Please find the amount of principal paid in the fourth payment P₄.

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A question in relation of capital budgeting for a 10 year project.

Say the tax rate for below question is 35%.

The buildings cost $200 000 have an estimated life of 20 years at which time their salvage value would be zero. They are to be depreciated on a straight line (prime cost) basis for tax purposes based on this life. The salvage value of the buildings after 10 years is expected to be $50,000.

The equipment cost $400 000 has an estimated life of 10 years and a zero salvage value. The equipment is to be depreciated on a straight line (prime cost) basis for tax purposes based on this life.

What are the tax implications? Is there is gain or loss and how would you account for this in year 10 of the cash flow. Could you provide an example.

John is currently an engineer at an automobile manufacturer in Ontario. Next year he is going to start his own automobile parts manufacturing company in Vancouver. He wants his company to be entirely e-commerce and he wants to sell his products to retailers of automotive parts and accessories, such as Lordco. He needs to know how to find and connect with customers but he is unsure how to do so. John also is worried about buying the right hardware and software because he only has a limited amount of money to spend. He knows that product ordering and billing is a critical part of doing business online and he has a lot to learn. Most of all, John is concerned about online theft of information so he wants to make sure that from the time a customer makes an order until the parts are delivered that all information is safe. This will be John’s first time in business and he is a little unsure of himself. He decides that he needs to hire you to describe to him some of the basics about the type of e-commerce business he is getting into and also to help him solve his business problems. You are a business expert and knowledge worker and you have studied Busi 237. Using the key terms and concepts from your textbook explain what John needs to do.

A 7-year project is expected to generate annual sales of 10,400 units at a price of $91 per unit and a variable cost of $62 per unit. The equipment necessary for the project will cost $437,000 and will be depreciated on a straight-line basis over the life of the project. Fixed costs are $265,000 per year and the tax rate is 35 percent. How sensitive is the operating cash flow to a $1 change in the per unit sales price?

The stockholders’ equity section of Grouper Inc. at the beginning of the current year appears below.

During the current year, the following transactions occurred.

Prepare the stockholders’ equity section of the balance sheet at the end of the current year. Assume that retained earnings at the end of the current year is $824,000.

The following information was taken from the records of Skysong Inc. for the year 2017: Income tax applicable to income from continuing operations $174,148; income tax applicable to loss on discontinued operations $28,322, and unrealized holding gain on available-for-sale securities (net of tax) $18,000.

Shares outstanding during 2017 were 105,300.

Prepare a single-step income statement. (Round earnings per share to 2 decimal places, e.g. 1.48.)

Note: This problem is for the 2018 tax year. Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2016. Alfred and Beulah will file a joint return for 2018. Alfred's Social Security number is 111-11-1112. Beulah's Social Security number is 123-45-6789, and she adopted "Old" as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay Sarah $1,250 per month for the next 10 years or until Sarah's death, whichever occurs first. Alfred pays Sarah $15,000 in 2018. In addition, in January 2018, Alfred pays Sarah $50,000, which is designated as being for her share of the marital property. Also, Alfred is responsible for all prior years' income taxes. Sarah's Social Security number is 123-45-6788. Alfred's salary for 2018 is $150,000, and his employer, Cherry, Inc. (Federal I.D. No. 98-7654321), provides him with group term life insurance equal to twice his annual salary. His employer withheld $24,900 for Federal income taxes and $8,000 for state income taxes. The proper amounts were withheld for FICA taxes. Beulah recently graduated from law school and is employed by Legal Aid Society, Inc. (Federal I.D. No. 11-1111111), as a public defender. She receives a salary of $42,000 in 2018. Her employer withheld $7,500 for Federal income taxes and $2,400 for state income taxes. The proper amounts were withheld for FICA taxes. Beulah has $500 in qualified dividends on Yellow Corporation stock she inherited. Alfred and Beulah receive a $1,900 refund on their 2017 state income taxes. They itemized deductions on their 2017 Federal income tax return (total of $15,000). Alfred and Beulah pay $4,500 interest and $1,450 property taxes on their personal residence in 2018. Their charitable contributions total $2,400 (all to their church). They paid sales taxes of $1,400, for which they maintain the receipts. Both spouses had health insurance for all months of 2018 and do not want to contribute to the Presidential Election Campaign. Required: Compute Alfred and Beulah's net tax payable (or refund due) for 2018, on a joint return, by providing the following information that would be reported on Form 1040, Schedule A, and Schedule B. Enter all amounts as positive numbers. If is zero, enter "0". Make realistic assumptions about any missing data. If required round your final answers to the nearest dollar.

The following information pertains to the City of Williamson for 2017, its first year of legal existence. For convenience, assume that all transactions are for the general fund, which has three separate functions: general government, public safety, and health and sanitation. Receipts: Property taxes $414,000 Franchise taxes 43,000 Charges for general government services 6,200 Charges for public safety services 4,300 Charges for health and sanitation services 47,800 Issued long-term note payable 314,000 Receivables at end of year: Property taxes (90% estimated to be collectible) 100,800 Payments: Salary: General government 60,200 Public safety 32,800 Health and sanitation 20,200 Rent: General government 16,300 Public safety 21,000 Health and sanitation 3,900 Maintenance: General government 27,600 Public safety 5,700 Health and sanitation 11,500 Insurance: General government 8,400 Public safety ($3,800 still prepaid at end of year) 15,300 Health and sanitation 15,700 Interest on debt 25,120 Principal payment on debt 6,280 Storage shed 194,000 Equipment 120,000 Supplies (20% still held) (public safety) 16,600 Investments 92,000 Ordered but not received: Equipment 16,500 Due in one month at end of year: Salaries: General government 4,500 Public safety 8,400 Health and sanitation 9,300 Compensated absences (such as vacations and sick days) are legally owed to general government workers at year-end total $19,500. These amounts will not be taken by the employees until so late in 2018 that the payment is not viewed as requiring 2017 current financial resources. The city received a piece of art this year as a donation. It is valued at $23,900. It will be used for general government purposes. There are no eligibility requirements. The city chose not to capitalize this property. The general government uses the storage shed that was acquired this year. It is being depreciated over 10 years using the straight-line method with no salvage value. The city uses the equipment for health and sanitation and depreciates it using the straight-line method over five years with no salvage value. The investments are valued at $109,900 at the end of the year. For the equipment that has been ordered but not yet received, the City Council (the highest decision-making body in the government) has voted to honor the commitment when the equipment is received. a-1. Prepare a statement of activities for governmental activities for December 31, 2017. a-2. Prepare a statement of net position for governmental activities for December 31, 2017. b-1. Prepare a statement of revenues, expenditures, and other changes in fund balances for the general fund as of December 31, 2017. Assume that the city applies the consumption method. b-2. Prepare a balance sheet for the general fund as of December 31, 2017. Assume that the city applies the consumption method.