Problem 6-50 (LO. 1, 3)Chee, single, age 40, had the following income and expenses during 2021:Income Salary$43,000Rental of vacation home (rented 60 days, used personally 60 days, vacant 245 days)4,000Municipal bond interest2,000Dividend from General Electric400Expenses Interest on home mortgage8,400Interest on vacation home4,758Interest on loan used to buy municipal bonds3,100Property tax on home2,200Property tax on vacation home1,098State income tax3,300State sales tax900Charitable contributions1,100Tax return preparation fee300Utilities and maintenance on vacation home2,600Depreciation on rental portion of vacation home3,500Calculate Chee's net income from the vacation home, itemized deductions and taxable income for the year. If Chee has any options, choose the method that maximizes his deductions.In your computations, round any fractions to four decimal places. Then, round any amounts to the nearest dollar. If an amount is zero, enter "0". Assume 365 days in a year.a. Net income from vacation home: $fill in the blank 1b. Itemized deductions: $fill in the blank 2c. Taxable income: $fill in the blank 3

There is a 2% of AGI floor that reduces the allowed deduction for tax preparation fee. In this…

Answered: Problem 6-50 (LO. 1, 3) Chee, single,…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Problem 6-50 (LO. 1, 3)

Chee, single, age 40, had the following income and expenses during 2021:

Income
Salary	$43,000
Rental of vacation home (rented 60 days, used
personally 60 days, vacant 245 days)	4,000
Municipal bond interest	2,000
Dividend from General Electric	400
Expenses
Interest on home mortgage	8,400
Interest on vacation home	4,758
Interest on loan used to buy municipal bonds	3,100
Property tax on home	2,200
Property tax on vacation home	1,098
State income tax	3,300
State sales tax	900
Charitable contributions	1,100
Tax return preparation fee	300
Utilities and maintenance on vacation home	2,600
Depreciation on rental portion of vacation home	3,500

Calculate Chee's net income from the vacation home, itemized deductions and taxable income for the year. If Chee has any options, choose the method that maximizes his deductions.

In your computations, round any fractions to four decimal places. Then, round any amounts to the nearest dollar. If an amount is zero, enter "0". Assume 365 days in a year.

a. Net income from vacation home:   $fill in the blank 1

b. Itemized deductions:   $fill in the blank 2

c. Taxable income:   $fill in the blank 3

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