Johnny's personal-use classic Ford Mustang, for which he paid $12,000 seven years ago but now worth $20,000, was completely destroyed in a hurricane, which was declared a federal disaster. Johnny does not carry auto insurance. As a result of the hurricane, Johnny missed a business meeting and lost out on an order from which he would have earned $3,000. In that same hurricane, Johnny lost his stereo equipment worth $1,600 (purchase price $2,500), along with jewelry valued at $4,000 (purchase price $3,000). Johnny's homeowner's policy covered $5,000 of this loss. His adjusted gross income for the year is $80,000. Assuming he can itemize his deductions, calculate his deductible casualty and theft loss.
Q: A firm has total assets of $3,000,000. It has $1,200,000 in long-term debt. The stockholder’s equity…
A: Total debt to asset ratio is the one which helps in measuring the total debts of the entity with…
Q: Louis wins the Lottery and, after taxes, gets to keep $3 million. He quits his job, buys a house and…
A: Bankruptcy refers to the legal procedure through which the person or entities who could not repay…
Q: FDN Trading provided the following information during the current year. Proceeds from bank loans,…
A: Cash flow from Financing activities includes the transactions relating to the loan/debt,…
Q: Robert Jones has just rendered service for a taxpayer as an expert witness in a case heard by the U.…
A: Relevant Facts Robert Jones recently assisted a taxpayer in a lawsuit before the US Tax Court as an…
Q: _____Amortization of limited-life intangible assets should not be impacted by expected residual…
A: Intangible assets are those assets which do not have its physical presence and it can't be touched.…
Q: Merchandise with a sales price of $13,000 is sold on account with terms 2/10, r/30. The Journal…
A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…
Q: Premier Candle Company manufactures candles. The standard direct materials quantity required to…
A: The variance is the difference between the actual data and standard output of the production. The…
Q: By reference to QC Section 10, A Firm’s System of Quality Control, paragraphs 18 and A2. List the…
A: 1. Leadership Responsibility: The firm’s leadership is responsible for setting the tone at the top…
Q: Cup Company produces products in two Departments. The following information has been provided about…
A: Plant wide overhead rate :— It is calculated by dividing total estimated overhead cost by estimated…
Q: According to the text, what hierarchical system of social organization is sexism interwoven with?
A: The correct answer is: (B) Patriarchy Patriarchy is a hierarchical system of social organisation in…
Q: Calculate and fill in the 6 blanks in the following Cash Flow Budget. You do not need to show y…
A: The cash budget is an estimate of cash inflows and outflows over a given time period. It assists…
Q: Decision-makers must establish their needs and discover what data will help them to answer their…
A: Decision making is the technique of creating picks through figuring out a decision, accumulating…
Q: what is a tipee liable for insider trading
A: Insider trading is illegal and punishable by law. A tipee is someone who receives information from…
Q: P2) On January 1, Sawmill Corporation sold $50,000, 10-year, 10 percent bonds at 94. Interest is…
A: Since you have posted a question with multiple sub parts, we will provide the solution only to the…
Q: Value Electronics uses a standard part in the manufacture of different types of radios. The total…
A: Operating income is the amount of income earned by the entity from the daily operations. It do not…
Q: Question 5-3 Sami, Hani, and Maha have capital balances of $60,000, $80,000, and $70,000,…
A: The partnership comes into existence when two or more persons agree to do the business and further…
Q: On December 2, 2022, Andrew Corporation issued for cash 12,000 shares of no-par ordinary shares with…
A: Stockholder's Equity -Stockholder's Equity includes the amount contributed by shareholders issued in…
Q: Sheffield Plus has outgrown its current building and needs to find additional storage space. The…
A: The stand-alone method of cost allocation is a method where the common cost of the entity is…
Q: You are currently on work experience at CMAS Co-operative Ltd and the General Manager has asked your…
A: Impairment loss is the amount that represents a difference between the recoverable value of an asset…
Q: Rotorua Products, Limited, of New Zealand markets agricultural products for the burgeoning Asian…
A: You are able to analyze several pieces of financial information, such as net sales, cost of goods…
Q: homework gives the following options as answers, so it the above one wrong? 25.73% 34.93%…
A: Return on equity can be calculated with this formula also = Net Income/ shareholders equity
Q: BFAR Corporation has the following transactions during the year: Authorized Ordinary share capital…
A: Stockholders' equity: Stockholders' equity means the net assets available to shareholders after…
Q: The controller of Ultramint Company wishes to improve the company's control system by preparing a…
A: The cash budget is prepared to estimate the cash balance available with business at the end of…
Q: On January 1, 20x1, Toy inc. issued $500,000 of convertible bonds. The bonds mature on December 31,…
A: Discount on issue of bond: If coupon rate of bond is less than market rate when similar bonds are…
Q: DeeGee Ltd. acquired a Patent on April 1, 2020 for $650,000. DeeGee can only provide evidence of…
A: Required 1 of 2 As it is evident from the question that Patent will have clearly identifiable cash…
Q: On aug 1, 2022 Lid Ltd purchased 1100 Agnus common shares for 44300 cash, with intetion of trading…
A: A financial asset is a part of financial instruments which includes Cash, Investment in the common…
Q: Jungle Junior Company manufactures and sells outdoor play equipment. Jungle Junior uses…
A: Activity-based costing (ABC) method: It is a method of assigning of indirect costs and overhead to a…
Q: BFAR Corporation issued 20,000 ordinary shares receiving land that costs P200,000 and has a fair…
A: Legal capital is that amount of equity that cannot legally be allowed to leave the business; it…
Q: For the current year, Purchases were P324,000; Purchase Returns and Allowances were $3,500; Freight…
A: Cost of goods sold (COGS) : Cost of goods sold budget shows the expenses incurred for producing a…
Q: Suppose that Oriole purchased a new machine on October 1, 2025 at a cost of $416,000. The company…
A: Straight Line Method of Depreciation :— In this method, depreciation expense per year is calculated…
Q: Magic Cleaning Services Unadjusted Trial Balance At December 31 Debit $430,900 158,000 111,000 2,400…
A: Adjusted Trial balance is the trial balance that is prepared after adjustment to ledger accounts…
Q: BFAR Corporation has the following transactions related to treasury shares: . Purchased its own…
A: Treasury stock: Shares that are bought back by the company from the open market but not retired from…
Q: BFAR Corporation has the following information in its shareholders' equity: • Ordinary Share Capital…
A: Dividends are not paid on treasury shares, hence dividends are paid on shares outstanding. Shares…
Q: On January 1, 2025, Larkspur Corporation issued $560,000 of 7% bonds, due in 10 years. The bonds…
A: When the bonds are issued at less than their face value, it is said that the bonds are issued at…
Q: BFAR Corporation reported the following shareholders' equity on January 1, 2022: Share capital, P10…
A: Stockholders' equity: Stockholders' equity means the net assets available to shareholders after…
Q: The factors affecting pension expense are not always obvious. As the accountant for Sunlight City,…
A: Pension expense is the expense incurred by the employer for the benefit of the future of the…
Q: Prior to the subscription of MJE, the accounting equation of BFAR Corporation is Assets Liabilities…
A: STATEMENT OF SHAREHOLDERS EQUITY Statement of Shareholders Equity is also Known as Changes in…
Q: How much is the depreciation expense
A: Accounting of promotional item: When along with purchase of any property, plant and equipment (PPE)…
Q: You plan to invest $40,000 at the end of each of the next 25 years. If the investment account pays…
A: The table below shows the interest earned and the amount at the end of 25th year.
Q: Suppose that Oriole purchased a new machine on October 1, 2025 at a cost of $416,000. The company…
A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…
Q: Which of the following accounts does NOT belong to the group? O Freight Out Sales Commission Expense…
A: The expenses incurred to storw and sell the products are said to be selling and administrative…
Q: The following financial statements were drawn from the records of Thornton Shoes: Assets Cash…
A: Cash Flow Statement - Statement of Cash Flow shows the inflow and outflow of cash during the…
Q: Prior to the subscription of MJE, the accounting equation of BFAR Corporation is Assets Liabilities…
A: The general fairness of a enterprise is derived with the aid of using subtracting its liabilities…
Q: Prepare the following budgets for the months of April, May, and June: 1. Sales budget. 2.…
A:
Q: Based on the wage-bracket method, the federal income tax withholding for an employee who files as…
A: Tax liability: Tax liability is the total amount of taxes that a person or business owes to the…
Q: The book value (carrying amount) of a fixed asset (plant, property, and equipment) is equal to its…
A: Depreciation Expenses :— It is the decrease in the value of assets due to continuos use of asset.…
Q: Oriole Company sells product 1976NLC for $31.00 per unit. The cost of one unit of 1976NLC is $30,…
A: Inventory is reported at cost or market price which ever is lower. Market price is net realisable…
Q: Nacho Corporation reported revenues of $120,000, variable costs of $80,000 and a margin of safety of…
A: Fixed cost is the amount of cost which remains fixed irrespective of the changes in the production…
Q: True or false ______Magazine subscriptions and airline ticket sales both result in unearned…
A: Unearned revenue is one of the types of current liabilities shown in the balance sheet of the…
Q: How can a misstatement in one financial statement, whether intentional or not, affect a presentation…
A: Mis-statements in financial statements are errors or omissions of financial data or where the…
Step by step
Solved in 2 steps
- Alicia's automobile destroyed in a tornado on 5/4/2021. This did not occur in a Federally declared disaster area. Her car was used 70% for business and 30% for personal use. The car had originally cost $40,000. At the time of the accident, the car was worth $20,000 and Alicia had taken $8,000 of depreciation. The car was totally destroyed and Alicia had let her car insurance expire. If her AGI is $50,000 (before considering the loss), determine her AGI and itemized deduction for the casualty loss. $34,000;$-0- $30,000;$-0- $26,000;$5,700 None of these $34,000;$4,500George and Emily Cosgrove of Athens, Georgia, recently had a fire in their garage that destroyed two of their cars and did considerable damage to the garage and to the outside of their home. After receiving their reimbursements from their homeowner's and automobile insurance policies, the Cosgroves realized that they were severely underinsured. One vehicle was not insured for fire, and the insurance on their dwelling amounted to only 60 percent of its current replacement value. What do you recommend to George and Emily about managing property and liability risk regarding: 1. The relationship between severity and frequency of loss when deciding whether to buy insurance?Christopher's main home was damaged by a tornado, and his county was later deemed a federal disaster area. He incurred $80,000 worth of damage to his home, but $65,000 was reimbursed by his homeowner's insurance. His basis in the home was $175,000 at the time of the tornado. Christopher's employer had a disaster relief fund for its employees. He received $5,000 from the fund and spent the entire amount on repairs to his home. What is Christopher's casualty loss (before the calculation of any limitations)? Group of answer choices $0 $10,000 $15,000 $5,000
- Mr. and Mrs. Marcum live in southern California in an area devastated by wildfires that the President designated a federally declared disaster. Because of fire damage, the Marcums had to replace the roof of their home at a cost of $62,000. Their homeowners insurance reimbursed them for only $37,200 of the cost. The Marcums' $24,800 unreimbursed loss was their only casualty loss this year. Assume the taxable year is 2023. Required: a. Compute their deductible casualty loss if their AGI is $166,500. b. Compute their deductible casualty loss if their AGI is $383,500. Complete this question by entering your answers in the tabs below. Required Required B Compute their deductible casualty loss if their AGI is $166,500. Note: Leave no cells blank be sure to enter "0" wherever required. Mr. and Mrs Marcum's deductible casualty loss Required B >BeBe had a tough year! She had two different unfortunate casualties during the year. First, her car was in an accident. Her car had a value of $20,000. Her basis (her cost) had been $30,000. After the accident, the value was reduced to only $10,000. Her insurance company reimbursed her for $3,000 only. Second, she had a separate free-standing storage she on her property, which burned down. The shed had a fair market value of $4,000, and a cost adjusted basis to BeBe of $3,500. Her insurance company reimbursed her $3,000 for her loss. If BeBe's adjusted gross income is $60,000, what is her deductible casualty loss, if any?Will purchased a home for $350,000 five years ago. He did significant renovations and additions increasing the value to $425,000. He forgot to update his original policy limits of $280,000. He incurred a $100,000 loss by fire. He has a $2,500 deductible. How much will he be responsible for after accounting for the amount his insurer will pay? In other words, how much of the loss will his insurer not pay?
- In the current year, Brit had a federally declared disaster fire hit her house that damaged a couch and completely destroyed a bed and an antique table. She had no fire insurance. The couch cost $300, the bed $450, and the table $65. Just before the fire, the couch had a fair market value of $70, the bed had a value of $275, and the table had a value of $200. After the fire, the couch was worth $20. Brit's casualty loss before any dollar limitations is А. $815 В. $545 С. $390 D. $525Kurt has 25/50/25 auto insurance coverage. One evening he lost control of his vehicle, hitting a parked car and damaging a storefront along the street. The damage to the parked car was $10,700, and the damage to the store was $18,500. What amount will the insurance company pay for the damage? What amount will Kurt have to pay?Jes had a personal casualty loss in 20X1 due to a hurricane damaging his home. The area where his loss occurred was a declared federal disaster area. Jes’s 20X1 adjusted gross income was $ 200,000. • The fair market value of John’s home before the casualty was $ 450,000, the fair market value after the casualty was $ 275,000.• John purchased his home 6 years ago for $ 150,000 and made no capital improvements while he owned the house.• John received $ 110,000 from his insurance company due to this loss. How much will Jes deduct as a casualty loss in 20X1 if he itemizes his deductions? a. Zerob. $ 65,000c. $ 40,000d. $ 44,900e. $ 19,900
- Jorge and his wife own a beachfront vacation home in Savannah, Georgia. During the year, high winds from a tropical storm shatter a sliding glass door and rain from the storm causes extensive water damage to the kitchen. The Savannah area qualified for federal disaster relief. Fortunately, during a calm in the storm, Jorge is able to board up the door, which limits the water damage to the kitchen. The items damaged in the storm are: Cost ValueBefore ValueAfter InsuranceProceeds Kitchen furniture $2,085 $1,325 $430 $510 TV 265 200 0 115 Refrigerator 1,000 920 90 775 Linoleum flooring 1,645 880 0 470 In addition, Jorge pays $610 to replace the sliding glass door. The insurance company will not reimburse him for the cost of the new door because the old sliding glass door did not meet the company's standards for a hurricane area. The amount of Jorge's casualty loss before considering any annual limitations that may apply is…Carmen Viers lost everything to a fire and has spent the last eight weeks living in a motel room at a cost of $4 comma 7414,741. Her dwelling, which was destroyed as a result of a lightning strike, was insured with an HO-2 policy for $208 comma 336208,336. Prior to the loss, her home was valued at $255 comma 000255,000, her detached garage and poolhouse were valued at $29 comma 48629,486, and her personal property had an actual cash value of $85 comma 12185,121. To make matters worse she sustained $10,000 in injuries while trying without success to save her three Greyhound dogs valued at $6,000 each. How much of her total losses and expenses will be reimbursed if she has a $1,000 deductible? Question content area bottom Part 1 The amount of total losses and expenses she will be reimbursed if she has a $1,000 deductible isMegan crashed her car into another vehicle. The damage to her car cost $2,568 to repair. Damage to the other vehicle cost $6,820. Megan's collision coverage has a $1,000 deductible. Her property damage liability is $5,000. How much will her insurance company pay for repairs?