Concepts in Federal Taxation 2019 (with Intuit ProConnect Tax Online 2017 and RIA Checkpoint 1 term (6 months) Printed Access Card)
26th Edition
ISBN: 9781337702621
Author: Kevin E. Murphy, Mark Higgins
Publisher: Cengage Learning
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Question
Chapter 5, Problem 28P
To determine
Ascertain the manner in which each of the expenses will be deducted for tax purposes.
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Last year, lana purchased a $100,000 account receivable for $90,000. During the current year, Lucy collected $97,000 on the account. What are the tax consequences to Lucy associated with the collection of the account receivable? No subsequent collections are expected.
a.$7,000 gain
b.$3,000 loss
c.$13,000 loss
d.$2,000 gain
Kendra is a self-employed taxpayer working exclusively from her home office. Before the home office deduction, Kendra has $6,000 of net income. Her allocable home expenses are $10,000 in total. How are the home office expenses treated on her current year tax return?
a.Only $3,000 a year of the home office expenses may be deducted.
b.All home office expenses may be deducted, resulting in a business loss of $4,000.
c.Only $6,000 of home office expenses may be deducted, resulting in a net business income of zero. None of the remaining $4,000 of home office expenses may be carried forward or deducted.
d.Only $6,000 home office expenses may be deducted, resulting in net business income of zero. The remaining $4,000 of home office expenses may be carried forward and deducted in a future year against business income.
Which taxpayer may benefit from the investment interest expense deduction?
A. Everett. He borrowed money from his broker and used the funds to buy tax-exempt bonds. He paid interest on the loan.
B. Frank. He opened a margin account with his broker, as he wanted access to a line of credit. He did not borrow any money from the account during the year.
C. Marissa. She borrowed money from her broker to buy shares of stock for her investment account. She paid interest on the loan.
D. Roberta. She borrowed money on her margin account and used the funds for a home-improvement project. She paid interest on the loan.
Chapter 5 Solutions
Concepts in Federal Taxation 2019 (with Intuit ProConnect Tax Online 2017 and RIA Checkpoint 1 term (6 months) Printed Access Card)
Ch. 5 - Prob. 1DQCh. 5 - Why does the computation of adjusted gross income...Ch. 5 - Prob. 3DQCh. 5 - Prob. 4DQCh. 5 - Prob. 5DQCh. 5 - Prob. 6DQCh. 5 - Prob. 7DQCh. 5 - Prob. 8DQCh. 5 - Prob. 9DQCh. 5 - What is the difference between a trade or business...
Ch. 5 - Prob. 11DQCh. 5 - Prob. 12DQCh. 5 - Prob. 13DQCh. 5 - Prob. 14DQCh. 5 - Prob. 15DQCh. 5 - Prob. 16DQCh. 5 - Prob. 17DQCh. 5 - Prob. 18DQCh. 5 - Prob. 19DQCh. 5 - Prob. 20DQCh. 5 - Prob. 21DQCh. 5 - Prob. 22DQCh. 5 - Prob. 23DQCh. 5 - Prob. 24DQCh. 5 - Prob. 25DQCh. 5 - Prob. 26PCh. 5 - Prob. 27PCh. 5 - Prob. 28PCh. 5 - Prob. 29PCh. 5 - Prob. 30PCh. 5 - Prob. 31PCh. 5 - Prob. 32PCh. 5 - Prob. 33PCh. 5 - Prob. 34PCh. 5 - Prob. 35PCh. 5 - Prob. 36PCh. 5 - Prob. 37PCh. 5 - Prob. 38PCh. 5 - Prob. 39PCh. 5 - Prob. 40PCh. 5 - Prob. 41PCh. 5 - Prob. 42PCh. 5 - Prob. 43PCh. 5 - Prob. 44PCh. 5 - Prob. 45PCh. 5 - Prob. 46PCh. 5 - Prob. 47PCh. 5 - Prob. 48PCh. 5 - Prob. 49PCh. 5 - Prob. 50PCh. 5 - Prob. 51PCh. 5 - Prob. 52PCh. 5 - Prob. 53PCh. 5 - Prob. 54PCh. 5 - Prob. 55PCh. 5 - Prob. 56PCh. 5 - Ray, 83, is a used car dealer. He lives in a rural...Ch. 5 - Prob. 58PCh. 5 - Prob. 59PCh. 5 - Prob. 60PCh. 5 - Prob. 61PCh. 5 - Prob. 62PCh. 5 - Prob. 63PCh. 5 - Prob. 64PCh. 5 - Prob. 65PCh. 5 - Prob. 66PCh. 5 - Prob. 67PCh. 5 - Prob. 68PCh. 5 - Prob. 69PCh. 5 - Prob. 70PCh. 5 - Prob. 71PCh. 5 - Prob. 72IIPCh. 5 - Prob. 73IIPCh. 5 - Prob. 74IIPCh. 5 - Prob. 75IIPCh. 5 - Prob. 76IIPCh. 5 - Prob. 77IIPCh. 5 - Prob. 78IIPCh. 5 - Prob. 79IIPCh. 5 - Prob. 80IIPCh. 5 - Prob. 81IIPCh. 5 - Prob. 91CPCh. 5 - Prob. 92DCCh. 5 - Prob. 93DCCh. 5 - Prob. 94DCCh. 5 - Prob. 95TPCCh. 5 - Allison and Paul are married and have no children....
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