BB, WW and FF agree to sell construction tools for a period of one month. BB agrees the lawn of FF. FF will be paid P2,500 for cleaning up the lawn after the one-month se BB, wW and FF decide that net income, if any will be allocated first by the P2,500 commission on individual sales. The balance will be distributed 75% to BB and 25% t will complicate the matters and that all purchases and sales transactions will be out the individual. Sales to BB, WW and FF are to be at cost, except that the ending inve cost. All other sales are to be made at 100% mark-up on cost. The activity of the joint operation is as follows: a. BB construct the stand on the front of the lawn at a cost of P10,000; b. BB pays for P100,000 for various construction tools. FF pays P5,000 for pe

BB, WW and FF agree to sell construction tools for a period of one month. BB agrees the lawn of FF. FF will be paid P2,500 for cleaning up the lawn after the one-month se BB, wW and FF decide that net income, if any will be allocated first by the P2,500 commission on individual sales. The balance will be distributed 75% to BB and 25% t will complicate the matters and that all purchases and sales transactions will be out the individual. Sales to BB, WW and FF are to be at cost, except that the ending inve cost. All other sales are to be made at 100% mark-up on cost. The activity of the joint operation is as follows: a. BB construct the stand on the front of the lawn at a cost of P10,000; b. BB pays for P100,000 for various construction tools. FF pays P5,000 for pe

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter2: Gross Income And Exclusions

Section: Chapter Questions

Problem 10MCQ: Which of the following will result in the recognition of gross income? Gail's employer allows her to...

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BB, WW, and FF agree to sell construction tools for a period of one month. BB agrees to construct a stand on the front of the lawn of FF. FF will be paid P2,500 for cleaning up the lawn after the one-month selling period. BB, WW and FF decide that net income, if any will be allocated first by the P2,500 payment to FF and then by a 40% commission on individual sales. The balance will be distributed 75% to BB and 25% to WW. They agree that a cash box will complicate the matters and that all purchases and sales transactions will be out-of-pocket and the responsibility of the individual. Sales to BB, WW and FF are to be at cost, except that the ending inventory may be purchased at 50% of cost. All other sales are to be made at 100% mark-up on cost. The activity of the joint operation is as follows: BB construct the stand on the front of the lawn at a cost of 10,000 BB pays for P100,000 for various construction tools. FF pays P5,000 for permit to operate the concession or business BB…
BB, WW and FF agree to sell construction tools for a period of one month. BB agrees to construct a stand on the front of the lawn of FF. FF will be paid P2,500 for cleaning up the lawn after the one month selling period. BB, WW and FF decide that net income, if any will be allocated first by the P2,500 payment to FF and then by a 40% commission on individual sales. The balance will be distributed 75% to BB and 25% to WW. They agree that a cash box will complicate the matters and that all purchases and sales transactions will be out of-pocket and the responsibility of the individual. Sales to BB, WW and FF are to be at cost, except that the ending inventory may be purchased at 50% of cost. All other sales are to be made at 100% mark-up on cost. The activity of the joint operation is as follows: a. BB construct the stand on the front of the lawn at a cost of P10,000; b. BB pays for P100,000 for various construction tools. FF pays P5,000 for permit to operate the concession or business;…
Brisk, Whisk and Frisk agree to sell construction tools for a period of one month. Brisk agrees to construct a stand on the front of the lawn of Frisk. Frisk will be paid P2,500 for cleaning up the lawn after the one-month selling period. Brisk, Whisk and Frisk decide that net income, if any will be allocated first by the P2,500 payment to Frisk and then by a 40% commission on individual sales. The balance will be distributed 75% to Brisk and 25% to Whisk. They agree that a cash box will complicate the matters and that all purchases and sales transactions will be out-of-pocket and the responsibility of the individual. Sales to Brisk, Whisk and Frisk are to be at cost, except that the ending inventory may be purchased at 50% of cost. All other sales are to be made at 100% mark-up on cost. The activity of the joint operation is as follows: a. Brisk construct the stand on the front of the lawn at a cost of P10,000; b. Brisk pays for P100,000 for various construction tools. Frisk pays…
1. Debbie acquired a franchise to operate a donut shop from Dollar Donuts, Inc., for $100,000. She incurred anadditional $4,000 in legal costs to negotiate the terms with the franchiser. In five years, the franchise contract will berenegotiated. The current contract also states that there will be a $3, 000 annual fee plus a two percent charge basedon the store's annual revenue, which is expected to average 90,000 per year. What is the franchise cost that should becapitalized? a. $88,000 b. $92, 000 c. $100,000 d. $104,000
Rookie Cookies wants to rent a new bakery space to operate their business at $10,000 a year for the next 5 years. The rent agreement specifies that a $4,000 security deposit needs to be paid by Rookie up-front. In year 4 of the rental agreement, a one-time machinery maintenance fee of $6,000 will need to be paid by Rookie. When the rental agreement expires, Rookie feels they cam sell the machinery they maintained during the rental agreement for $7,000. Assuming a 10% ra of return, what is the present value (or cost) of the bakery space rental decision? Present Value of a $1 Present Value of an Annuity of $1 Period 10% Period 10% 0.909 1 0.909 2 0.826 0.751 0.683 0.621 3 345 O-$50,355 O-$41,297 O-$41,661 O-$18,655 2 3 45 1.736 2.487 3.170 3.791
Peyton sells an office building and the associated land on May 1 of the current year. Under the terms of the sales contract, Peyton is to receive $2,164,200 in cash. The purchaser is to assume Peyton's mortgage of $1,298,520 on the property. To enable the purchaser to obtain adequate financing, Peyton is to pay the $25,970 in points charged by the lender. The broker's commission on the sale is $86,568. What is Peyton's amount realized? The amount realized by Peyton is $
GerrinAL sells five machines to VernAL for $500,000 per machine, the list price for the machines is $600,000. In a separate contract they sell maintenance services on the five machines for the first year. They charge $12,000 per machine for the maintenance, the list price for maintenance on the machine. As an incentive to sign the maintenance contract, GerrinAL gives VernAL a 25% discount on the purchase of machines in the next 75 days. No discounts are granted to other customers and they project there is 41% probability they will use the discount to purchase one machine with a stand-alone selling price of $600,000. What is the approximate contract consideration allocated to the discount? Select one: a. $150,000 b. $120,000 c. zero d. $50,000 e. $61,500
As part of its employee benefits plan, Omega Corporation acquired apiece of residential lot worth P2M for its Chief Executive Officer andconstructed upon it a house at a cost P4M. Ownership of the house andlot was turned over to the CEO upon completion of the construction. 40%of the value of the house and lot will be deducted from the director’ssalary over a period of 5 years. Compute the fringe benefit tax
Which of the following will result in the recognition of gross income? Gail's employer allows her to set aside $ 4,000 from her wages to cover the cost of daycare for Gail's four-year-old daughter. Gail's daycare costs are $ 4,300 for the year. Hannah purchases a new sofa from her employer, Sofas-R-Us, for $ 1,200. The cost of the sofa to the furniture store is $ 1,100 and the sofa normally sells for $ 1,700. Jayden's employer purchases her commuting pass for the subway at a cost of $ 225 per month. Havana is a lawyer. The law firm she works for pays for her subscription to Lawyer's Weekly, a trade magazine for attorneys. None of the above will result in recognition of gross income.
At the beginning of the current year, Clan Company offers the customers a pottery bowl if they send in three boxtops from the products and P10. The entity estimated that 60% of the boxtops would be redeemed.During the year, the entity sold 675,000 boxes and customers redeemed 330,000 boxtops receiving 110,000 bowls. The cost of each bowl is P 25.What is the liability for outstanding premium at year-end?
Jamie receives a basic pay of P29,880 a month and a 2% commission on her sales. She sold P505,000 in December. How much is her gross pay for the month? How much is her SSS deduction? How much is her PhilHealth deduction?