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- • Cynthia is an electrician, age 29, and single. • Cynthia has investment income and has a consolidated broker’s statement.• Cynthia began a cleaning service business in 2020. She was paid on Form 1099-NEC for 2021. She also received additional cash receipts of $400 not reported on the Form 1099-NEC. • Cynthia uses the cash method of accounting. She uses business code 561720.• Cynthia has receipts for the following expenses:- $350 for cleaning supplies- $225 for business cards - $450 for a mop, broom, and vacuum cleaner - $150 for work gloves - $125 for lunches - $175 for work clothes suitable for everyday use • Cynthia has a detailed mileage log reporting for 2021:- Mileage from her home to her first client’s home and mileage from her last client’s home to her home – 750 miles- In addition, on the days Cynthia worked for multiple clients, she kept track of the mileage from the first client’s home to the second client’s home in case that mileage was also deductible. She logged 450…! Required information [The following information applies to the questions displayed below.] In January of year 0, Justin paid $5,400 for an insurance policy that covers his business property for accidents and casualties. Justin is a calendar-year taxpayer who uses the cash method of accounting. What amount of the insurance premium may Justin deduct in year O in each of the following alternative scenarios? (Leave no answers blank. Enter zero if applicable.) a. The policy covers the business property from April 1 of year 0 through March 31 of year 1. Deductible amountRequired information [The following information applies to the questions displayed below.] In January of year 0, Justin paid $8,800 for an insurance policy that covers his business property for accidents and casualties. Justin is a calendar-year taxpayer who uses the cash method of accounting. What amount of the insurance premium may Justin deduct in year O in each of the following alternative scenarios? Note: Leave no answers blank. Enter zero if applicable. d. Instead of paying an insurance premium, Justin pays $8,800 to rent his business property from April 1 of year 0 throug March 31 of year 1. Deductible amount
- George's long-time client, Henrietta, brought in business records this year showing $40,000 of business income and $30,000 of related expenses. In prior years, her expenses have been closer to $10,000. Which of the following should George do to ensure that he complies with his Circular 230 duty of due diligence as to accuracy? Refuse to prepare the return unless Henrietta can provide receipts for each individual expense. Review the records Henrietta provided to see if they adequately explain the sharp increase in expenses. If he has any remaining questions, he should ask Henrietta to explain. Independently investigate by calling a random sample of the vendors listed to verify that Henrietta really paid the amounts claimed. Prepare Henrietta's return using the expenses listed on the prior-year return.Sally is in the business of purchasing accounts receivable. Last year, Sally purchased an account receivable with a face value of $80,000 for $60,000. During the current year, Sally settled the account, receiving $65,000. Determine the maximum amount of the bad debt deduction for Sally for the current year. If an amount is zero, enter "0". Sally's basis in the account receivable is $fill in the blank 1 . Therefore, she has a bad debt deduction of $fill in the blank 2 and income of $fill in the blank 3 .ASLEY is in the business of purchasing accounts receivable from businesses at a discount and then collecting them. Last year, she purchased a $30,000 account receivable for $25,000. This year, the account was settled for $25,000. How much loss can Peggy deduct and in which year? a.$5,000 for the prior year. b.$5,000 for the prior year and $5,000 for the current year. c.$5,000 for the current year. d.$-0- for the current year.
- Sam owns an insurance agency and makes the following business gifts during the year. Calculate Sam's deduction for business gifts. If an amount is zero, enter "0". Donee Amount Amount Allowed 1. Ms. Sears (a client) $35, plus $4 shipping $ 2. Mr. Williams (a tennis partner, not a business prospect or client) 55 3. Mr. Sample (a client) and Mrs. Sample (nonclient wife of Mr. Sample) 22 20 4. Various customers (calendars costing $3 each with the company name on them) 300 5. Mr. Shiver (an employee gift, a watch, for 25 years of continuous service) 175 Total business gift deductionSam owns an insurance agency and makes the following business gifts during the year. Calculate Sam's deduction for business gifts. If an amount is zero, enter "0". Аmount Donee Amount Allowed 1. Ms. Sears (a client) $35, plus $4 shipping 2. Mr. Williams (a tennis partner, 55 not a business prospect or client) 3. Mr. Sample (a client) received $22 and Mrs. Sample (nonclient spouse of Mr. Sample) 42 received a gift valued at $20 4. Various customers (calendars 300 costing $3 each with the company name on them) 5. Mr. Shiver (an employee gift, 175 a watch, for 25 years of continuous service) Total business gift deductionPeter Marwick, an accountant and accrual basis taxpayer, performed accounting services in Year One for Ellie Vader. Peter gave Ellie a bill for $30,000 in Year One. Ellie paid Peter $5,000 in Year One, but Ellie disputes that she owes the other $25,000 because she thinks his work is shoddy. Ellie agreed to put $25,000 in escrow until she and Peter could resolve their legal dispute over Peter's fees. In Year Three after litigation, the dispute is resolved in Peter's favor and he gets the money out of escrow. How much income does Peter have and when? Question 9 options: Peter has $30,000 income in Year 1 because he is on the accrual method. Peter has no income in Year 1 because there is a contested liability. Ellie has $25,000 in cancellation of indebtedness income in Year 1. Peter has $5,000 income in Year 1 and $25,000 in Year 3 under the Claim of Right Doctrine.
- 1. Jackie owns a temporary employment agency that hires personnel to perform accounting services for clients. During the year, her expenses for her clients include the following: Cab fare to and from restaurants $ 490 Gratuity at restaurants 440 Meals 4,700 Cover charges 390 All expenses are reasonable. Required: How much of these expenses can Jackie deduct? How is the deduction classified?Ginny is an accountant by trade, she paid $1,000 each year to join as CPA member. She also has a knack for programming; hence she also joins the Computer Associates membership for $500 per year as she planned to find a new career as a programmer. Discuss her eligibility whether she can deduct both membership fees from her assessable income! please put 3 referencesI need some guidance with the following question. We do not need to complete form 1040 or any schedules. Just calculations. Thank you kindly. Wendy White, age 29 is single. She lives in San Diego, California. She is employed by KXXR television station as the evening news anchor. An examination of her records for 2018 revealed the following information: 1. Wendy earned $150,000 in salary. Her employer withheld $40,000 in Federal income taxes and the proper amount of FICA taxes. 2. Wendy also received $10,000 in self-employement income from personal appeareances during the year. Her unreimbursed expenses related to this income were: transportation and lodging, $523; meals, $120; and office supplies, $58. 3. Wendy reports the following additional deductions: home mortgage interest, $6,250; charitble contributions, $1,300; state and local income taxes, $3,100; and employment-related expenses, $920. Compute Wendy's taxable income for 2018 and her tax due (including any self-employment…