# Acct553Hw1

Pages: 2 (455 words) Published: February 3, 2013
ACCT553 Federal Taxes & Management Decisions
Week 1 Homework Questions
Allan Steynor
11th January 2013

31. Tom and Linda are married taxpayers who file a joint return. They have itemized deductions of \$12,250 and four exemptions. Assuming an adjusted gross income of \$40,000, what is their taxable income for 2012?

Taxable Income = Adjusted gross income – Itemized deductions – Exemptions Taxable Income = 40,000 – 12,250 – (3,800*4)
Taxable Income = 12,550

32. Compute Marie's taxable income for 2012, assuming she is single and claims two dependent children. Her adjusted gross income is \$70,000, and she has itemized deductions of \$9,000.

Taxable Income = Adjusted gross income – Itemized deductions – Personal Exemptions Taxable Income = 70,000 – 9,000 – (3,800*3)
Taxable Income = 49,600

36. Compute Stanley's taxable income for 2012, assuming he has \$1,000 in wages from working in a grocery store and \$2,000 in interest income from some bonds he owns. Stanley, age 16, is claimed as a dependent on his parents' return.

Taxable Income = Gross income – Standard deduction
Taxable Income = (1,000+2,000) – (1,000+300)
Taxable Income = 1,700

55. Mr. Z, a nondealer, sold assets on an installment plan. Determine Mr. Z's gross income for 2012. Relevant data include: Year| Installment Sales| Gross Profit| 2012 Collections| 2010| 200,000| 50,000| 25,000|

2011| 300,000| 81,000| 80,000|
2012| 400,000| 96,000| 125,000|

Gross profit perecentage;
2010 = 50,000/200,000 = 25%
2011 = 81,000/300,000 = 27%
2012 = 96,000/400,000 = 24%

Therefore Gross Income;
2010 = 25,000*25% = 6,250
2011 = 80,000*27% = 21,600
2012 = 125,000*24% = 30,000

Gross Income = 6,250+21,600+30,000 = 57,850

69. Comprehensive Problem. Bill is a cash-basis, calendar-year taxpayer. Which of the following December items result in gross income or deductions for the current year? a. Check received for December rent, \$700, not deposited until January 4...