BUSINESS LAW (LOOSE)-W/ACCESS >CUSTOM<
BUSINESS LAW (LOOSE)-W/ACCESS >CUSTOM<
16th Edition
ISBN: 9781305768697
Author: Mann
Publisher: Cengage Learning
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Chapter 12, Problem 20CP
Summary Introduction

To determine: Whether person P recover half of the proceeds from person A.

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In 2012, Angela took out a $15,000 loan against the cash surrender value of her whole life insurance policy. The funds were required to help pay for remodeling and redecorating her home. As a consequences of taking out the loan Angela had to report $3,000 of policy gain in 2014. She repaid $5,000 of the loan at the end of 2015, as well as paying the $600 of loan interest due for the year. What were the tax consequences to Angela and the policy as a result of the 2015 payments? A. She will be able to deduct $5,600 from her taxable income for 2015 ad the ACB of the policy will increased by $2,000. B. She will be able to deduct $3,000 from her taxable income for 2015 and the ACB of the policy will increase by $2,600. C. She will not be able to claim any deduction from her taxable income for 2015 and the ACB of the policy will increase by $5,650. D. She will be able to deduct $3,600 from her taxable income for 2015 and the ACB of the policy will increase by $2,000
Eric and Susan just purchased their first home, which cost $140,000. They purchased a homeowner’s policy to insure the home for $130,000 and personal property for $80,000. They declined any coverage for additional living expenses. The deductible for the policy is $500. Soon after Eric and Susan moved into their new home, a strong windstorm caused damage to their roof. They reported the roof damage to be $19,500. While the roof was under repair, the couple had to live in a nearby hotel for three days. The hotel bill amounted to $420. Assuming the insurance company settles claims using the replacement value method, what amount will the insurance company pay for the damages to the roof?
Carl works as a waiter for a restaurant in Panama City Beach, Florida. The restaurant closes at 11:00 p.m. Two patrons came in at 10:30 p.m. and stayed until 12:00 a.m. Carl was their waiter and gave excellent customer service. The patrons left a $5.00 tip for Carl on a $200.00 bill and left a note saying, “Go back to school if you want more money.” Carl was so upset that he went home and posted on Facebook about how cheap, stinky, and ugly the patrons were. Carl mentioned the restaurant's name in his post. Carl had only 20 Facebook friends, and his privacy settings only allowed friends to see his posts. One of Carl's coworkers saw the post and told the restaurant manager. The restaurant manager terminated Carl based on violating two company policies: 1. The policy prohibiting speaking disparagingly about customers and 2. The policy prohibits casting the restaurant negatively on social media networks. Carl is not in a union. How do you analyze whether or not the restaurant's…
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