4 Last year Alice worked as a consultant. She hired an administrative assistant for $17,000 per year and rented office space (utilities included) for $2,600 per month. Her total revenue for the year was $105,000. If Alice hadn't worked as a consultant, she would have worked at a real estate firm earning $40,000 a year. Last year, Alice's and her economic profit A. $88,000; $65,000 B. $73,800; -$40,000 accounting profit was was ___ C. $85,400; $62,400 D. $56,800; $16,80
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- 2 Josh is an employee of a large Accounting firm in the city earning $120,000 per year. On weekends, to earn extra income, she established a small business selling Pokemon soft toys at the local market. In the first year of operating her business, she earned $8,000 revenue and incurred expenses of $10,000. Can he offset this loss against her salary income of $120,00? Would your answers will be different if Joss has been doing business this year for the past 5 years and the it was profitable on the first 3 years.Josh is an employee of a large Accounting firm in the city earning $120,000 peryear. On weekends, to earn extra income, she established a small businessselling Pokemon soft toys at the local market. In the first year of operating herbusiness, she earned $8,000 revenue and incurred expenses of $10,000. Can heoffset this loss against her salary income of $120,00? Would your answers will bedifferent if Joss has been doing business this year for the past 5 years and the itwas profitable on the first 3 years.Wendy decides to open her own business and earns 70,000 in accounting profit the first year. When deciding to open her own business she withdrew 20,000 from her savings which earned 2.5 percent interest took over a building that she owns and was renting to her friend for 12,500 a year. She also turned down three separate job offers with annual salaries of 30000 40,000, And 47,000 1. Determine Wendy’s total implicit costs? Explain in detail 2. What is Wendy’s economic profit from running her own business ? Explain in detail show all calculations
- Brenda Sheldon, CPA, pays her new staff accountant, Abby , a salary equivalent to $21 per hour while Brenda receives a salary equivalent to $37 per hour. The firm's predetermined indirect cost allocation rate for the year is $11 per hour. Sheldon bills for the firm's services at 34% over cost. Assume Brenda works 6 hours and Abby works 8 hours preparing a tax return for Mikayla Touchstone. 1. What is the total cost of preparing Touchstone's tax return? 2. How much will Brenda bill Touchstone for the tax work?started a business writing a popular syndicated tax advice column in the current year and will report a profit for her first year. Her results of operations are as follows: Gross income $46,000 Travel expense 3,700 Business suits, to visit magazine editors 1,200 Transportation, 749 miles (at 57.5 cents per mile) 431 Entertainment 800 Subscription to accounting and tax magazines 550 Gifts: 8 at $100 each; 3 at $20 each 860 Rent and utilities for apartment, in total(10 percent is used for a home office) 7,000 What is the net income Lauren should show on her Schedule C? Show the calculation of her taxable income. In order to receive full credit, you must show all work. Gross income $_________ Expenses (describe each) _________ _________ _________ _________ _________ _________ _________ Taxable income $_________Veronica Valentine works as a financial consultant as her sideline which earns her approximately 35,000 a month. She however, has a full time job as a supervisor in one of the big corporations in the City. Her full time job pays her 84,950 per month and has benefits like: rice allowance of 5,000 per quarter; uniform allowance of 8,000 per year; meal allowance of 70 pesos per day(she works 26 days a month); representation allowance of 8900 per month; communication allowance of 3,000 per month. The company pays 14' month pay @100% of her monthly pay and a 15* month pay which is 60% of her monthly pay. Given the above stated data,compute for her. a.Monthly take home pay. b.It was found that at the end of the year,Ms. Valentine has accumulated a total of 15 hours tardiness.With this data in mind,compute for her total income tax to be paid to the government considering both sources of income.
- 14. Carla is not happy with her present job, she resigned and started her own business. The business requires her to travel so she used her car for the purpose. Assume that A started her business on April 1 and that the uses the car for business 70% of the time. Assuming total expenses for the year for the use of the car is P300,000, the deductible expense is:* a. 210,000 b. 225,000 c. 300,000 d. 157,500Ma1. Jamal, Kareem, Rashid and Associates are in the process of evaluating its new client services for the business consulting division. •Estate Planning, a new service, incurred $180,000 in development costs and employee training. •The direct costs of providing this service, which is all labor, averages $30 per hour. ⚫ Other costs for this service are estimated at $450,000 per year. ⚫The current program for estate planning is expected to last for two years. At that time, a new law will be in place that will require new operating guidelines for the tax consulting. ⚫ Customer service expenses average $104 per client, with each job lasting an average of 500 hours. The current staff expects to bill 50,000 hours for each of the two years the program is in effect. Billing averages $46 per hour. What is estimated life-cycle operating income for the first year? A. $149,200 B. $319,200 C. $159,600 D. $339,600“Louis's firm had the following situations during the year: Louis's CEO purchased a Ferrari for personal use and charged it to the company. Louis added five additional weeks to its fiscal year so it could improve its income. The accounting period for the previous years were 52 weeks. Equipment with a cost of £100,000 is reported at its market value of £150,000. Recently, Louis purchased a beach house for his personal use. However, he plans on using it for company retreats and for hosting large clients. Hence, he decided to list the asset and the corresponding liability for this reason (he used a loan to purchase this asset). Louis included £10,000 in accounts receivable and retained earnings for a service that he will provide next year. Since he is an honest man and will provide the service, he decided to record the amount this year. The company had paid £3,000 for insurance but uses only £2,000 during the period. The accountant has recorded £3,000 as insurance…
- Jenny Noon operates a Bed and Breakfast Inn in a resort area in the Ozark Mountains. The rooms rent at an average price of $60.00 per person per night (including meals). Depreciation on the inn is $40,000 per year. Jenny employs a part-time maintenance person at an annual salary of $17,000 per year and a cleaning person at an annual salary of $19,000 per year. Real estate taxes are $5,000 per year. Other costs are laundry service at a cost of $2.50 per person per night and the cost of food which is $3.50 per person per night. (Assume all guests will use the laundry service and eat their evening meal). Jenny is considering upgrading the breakfast service to attract more business and increase prices. This will increase Jenny’s food costs by $6.00 per person per night. Jenny feels she can increase the room rate charged to guests to $79.50 per person per night. Determine the dollar amount AND the number of guest rentals Jenny needs to break-even if the changes are made. Can…Jenny Noon operates a Bed and Breakfast Inn in a resort area in the Ozark Mountains. The rooms rent at an average price of $60.00 per person per night (including meals). Depreciation on the inn is $40,000 per year. Jenny employs a part-time maintenance person at an annual salary of $17,000 per year and a cleaning person at an annual salary of $19,000 per year. Real estate taxes are $5,000 per year. Other costs are laundry service at a cost of $2.50 per person per night and the cost of food which is $3.50 per person per night. (Assume all guests will use the laundry service and eat their evening meal). Determine the dollar amount AND the number of guest rentals Jenny needs to break-even. Can you show your workings please?Maria Clara Santos works is an accountant with her own accounting firm as well asteaching full time in a university. She earns an annual income of 2,679,000 fromthe operation of her firm. She is married with 4 children all minors. She alsoreceives income of 58,900 per month in the university. She receives 13 th and 14 thmonth pay, and other benefits amounting to 246,099 (excluding 13 th and 14 th monthpay). Compute for her annual tax return.
