Jane is an employee of Rohrs Golf Emporium. The shop allows employees to purchase equipment at significant discount. This year Jane purchased several new items to improve her game. Model FMV Dealer Cost Employee Price Driver $ 760 $ 540 $ 618 Irons $ 1,330 $ 840 $ 1,024 Balls $ 154 $ 145 $ 136 Bag $ 320 $ 245 $ 270 If the employer's average gross profit percentage is 20 percent, what amount must Jane include in income?
Jane is an employee of Rohrs Golf Emporium. The shop allows employees to purchase equipment at significant discount. This year Jane purchased several new items to improve her game. Model FMV Dealer Cost Employee Price Driver $ 760 $ 540 $ 618 Irons $ 1,330 $ 840 $ 1,024 Balls $ 154 $ 145 $ 136 Bag $ 320 $ 245 $ 270 If the employer's average gross profit percentage is 20 percent, what amount must Jane include in income?
Chapter6: Business Expenses
Section: Chapter Questions
Problem 71IIP
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Question
Jane is an employee of Rohrs Golf Emporium. The shop allows employees to purchase equipment at significant discount. This year Jane purchased several new items to improve her game.
| Model | FMV | Dealer Cost | Employee Price | |||
| Driver | $ | 760 | $ | 540 | $ | 618 |
| Irons | $ | 1,330 | $ | 840 | $ | 1,024 |
| Balls | $ | 154 | $ | 145 | $ | 136 |
| Bag | $ | 320 | $ | 245 | $ | 270 |
If the employer's average gross profit percentage is 20 percent, what amount must Jane include in income?
Expert Solution
Step 1
FMV (Fair Market Price):-It is a price at which products sell in the open market. One compares the actual price with the FMV in order to know the prevailing price of the product.
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ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT