None Jesse Wagner (an individual) has purchased an interest bearing investment in the amount of $50,000 on December1, 2020. It bears interest at 10% annually, but the interest will be paid up to date on December 31, 2023, and the finalpayment on November 30, 2025. 1. Determine the taxable amount of interest in each year

Interest Earned Each Year:From December 1, 2020, to December 31, 2021: No interest is paid during…

Answered: Jesse Wagner (an individual) has…

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter4: Gross Income: Concepts And Inclusions

Section: Chapter Questions

Problem 21CE

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Similar questions

On 12 May 2019, Alaa invested his money in Certificate of Deposit (CD) of Bank TTC, this CD has 5000 $ of face value and 6 percent interest.This CD will mature on 10 December 2019. Calculate the effective rate on his investment in this CD. ( assume 1 year are 365 days)
Devine purchased an annuity of N$1 500 per month from an insurer on 31 May 2019. The cash consideration paid by Devine was N$420 000 and the total expected returns of all the annuities as per the contract amounts to N$560 000. She received the first monthly cheque of N$1 500 on 30 June 2019. Required: Calculate the exempted capital element of the annuity received by Devine for the 2020 year of assessment. Answer:
On 1 November 2020, James was eligible to receive the following three annuities.(a) $2000 per annum payable on 1 February each year, with the FInal payment to be made on 1 February 2042;(b) $3200 per annum payable quarterly on 1 January, 1 April, 1 July and 1 October each year, with the FInal payment to be made on 1 January 2037;(c) $1800 per annum payable monthly on the FIrst day of each month, with the FInal payment to be made on 1 August 2039. Immediately after receiving the monthly payment due on 1 November 2020, James asked that these three annuities be combined into a single annuity payable half-yearly on 1 February and 1 August in each sub- sequent year with the FInal payment to be made on 1 February 2042. Find the amount of the revised annuity, given it was calculated assuming an interest rate of 8% per annum effective. Assume all months are of equal length.
In 2018 Freddie, a cash basis taxpayer, borrowed an amount from Roger amounting to 13,000 pesos payable after 2 years. The agreement provides that Freddie shall pay an advance interest of 20% per year upon the issuance of the proceeds loan. How much may Freddie claim as interest expense in 2020?
Reba Mc Entire wishes to invest $19, 000 on July 1, 2011, and have it accumulate to $49, 000 by July 1, 2021. Determine at what exact annual rate of interest Reba must invest the $19, 000.
Gus deposited $6,000 on February 4, 2021. How much does Gus have on September 4, 2028, if the rate is 4% compounded semiannually?
On January 1, 2023, Mr. Packard receives a $135,000 loan from his employer to assist him in purchasing a home. The loan requires annual interest at a rate of 3.1%, which he pays on December 31, 2023. Assume that the relevant prescribed rate is 5% during the first quarter of 2023, 6% during the second quarter, and 4%. What is the amount that Mr. Packard's is required to add to his 2023 employment income as a result of the employee loan?
On February 1, 2022, Mr. X promised to pay Ms. Y the amount of ₱10,000.00 at an annual rate of 6%. Mr. X gave a promissory note stating that the whole amount plus the interest will be paid on April 30, 2022. Prepare Mr. X’ journal entry on April 30, 2022.
Hans invests 1,000 on January 01 2021 in Fund A that credits interest at an effective annual rate of 8% for the first 7 years and 6% for the next 5 years. Hans withdraws interest from Fund A at the end of each year and deposits it in Fund B that credits interest at an effective annual rate of 7% during the years2021 to 2025 and 5% thereafter. X is Hans' total accumulated value in Fund A and Fund B combined at the end of 12 years.
Mr. Dayani purchases an annuity with funds from his savings account on January 1, 2018. The annuity has a 5 year term, and cost him $25,000. Payments are made annually on December 31 in the amount of $5,772. The annuity provides an effective yield of 5%. How much of the annuity payment is taxable in 2018? a. $772. b. $1,250. c. $5,000. d. Nil
Kavish loans $15,000 to his business partner on June 1st, 2020. The terms of the loan state that interest of 5% compounded annually will be paid when the loan matures on May 31st, 2022. What is the amount of interest income that Kavish must report in each year from 2020 2022? Show your calculations.
On January 1, 2019, Joan Campbell borrows $20,000 from Susan Rone and agrees to repay this amount in payments of $4,000 a year until the debt is paid in full. Payments are to be of an equal amount and are to include interest at 12% on the unpaid balance of principal at the beginning of each period. Assuming that the first payment is to be made on January 1, 2020, determine the number of payments of $4,000 each to be made and the amount of the final payment.

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