Question: Using the facts in problem 51, what
Using the facts in problem 51, what is the minimum tax that Pedro should pay to make the tax structure vertically equitable based on the tax rate paid? This would result in what type of tax rate structure?
Facts in Problem 51:
> A buoy oscillates in simple harmonic motion y = A cos ωt as waves move past it. The buoy moves a total of 3.5 feet (vertically) from its low point to its high point. It returns to its high point every 10 seconds. Write an equation describing the motion o
> A 15-centimeter pendulum moves according to the equation θ = 0.2 cos 8t, where θ is the angular displacement from the vertical in radians and t is the time in seconds. Determine the maximum angular displacement and the rate of change of θ when t = 3 seco
> The displacement from equilibrium of an object in harmonic motion on the end of a spring is /
> The frequency F of a fire truck siren heard by a stationary observer is Where ±v represents the velocity of the accelerating fire truck in meters per second. Find the rate of change of F with respect to v when The fire truck is approaching
> The graphs of f and g are shown. Let h(x) = f (g(x)) and s(x) = g( f (x)). Find each derivative, if it exists. If the derivative does not exist, explain why. Find h’ (3) Find s’ (9)
> y = 5(2 – x3)4 Find the derivative of the function.
> Describe the Chain Rule for the composition of two differentiable functions in your own words.
> Tawana owns and operates a sole proprietorship and has a 37 percent marginal tax rate. She provides her son, Jonathon, $8,000 a year for college expenses. Jonathon works as a pizza delivery person every fall and has a marginal tax rate of 15 percent. a)
> Cloud computing is the use of hosted computer facilities through the Internet. Gmail, RIA Checkpoint, and even your iPhone are some applications of cloud computing. a) If HP provides a customized bundle of servers, storage, network and security software,
> Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. In the conditions listed below, how much income should each report from SleepEZ for 2019 under both the daily allocation and the specific identification allocation method? Refe
> Owl Vision Corporation (OVC) is a North Carolina corporation engaged in the manufacture and sale of contact lenses and other optical equipment. The company handles its export sales through sales branches in Belgium and Singapore. The average tax book val
> Sandra would like to organize BAL as either an LLC (taxed as a sole proprietorship) or a C corporation. In either form, the entity is expected to generate an 8 percent annual before-tax return on a $500,000 investment. Sandra’s marginal income tax rate i
> Spartan Corporation, a U.S. corporation, reported $2 million of pretax income from its business operations in Spartania, which were conducted through a foreign branch. Spartania taxes branch income at 15 percent, and the United States taxes corporate inc
> Nicole’s employer, Poe Corporation, provides her with an automobile allowance of $20,000 every other year. Her marginal tax rate is 32 percent. Poe Corporation has a marginal tax rate of 21 percent. Answer the following questions relating to this fringe
> This year, Jolt Inc. reported $40,000 of taxable income before any charitable contribution deduction. Jolt contributed $10,000 this year to Goodwill Industries, a public charity. Compute the company’s current E&P.
> On May 1, year 1, Anna received 5,000 shares of restricted stock from her employer, Jarbal Corporation. On that date, the stock price was $5 per share. On receiving the restricted stock, Anna made the 83(b) election. Anna’s restricted shares will all ves
> Marcus is the CEO of publicly traded ABC Corporation and earns a salary of $1,500,000. Assume ABC has a 21 percent marginal tax rate. What is ABC’s after tax cost of paying Marcus’s salary?
> Cathy, Heathcliff, and Isabelle are equal shareholders in Wuthering Heights (WH), an S corporation. Heathcliff has decided he would like to terminate the S election. In the following alternative scenarios, indicate whether the termination will occur and
> What tax benefits does the buyer hope to obtain by making a §338 or §338(h)(10) election? Describe how this election might affect the value offered for the target corporation.
> Describe the three hurdles a taxpayer must pass if he wants to deduct a loss from his share in an S corporation. What other loss limitation rule may impact the deductibility of losses from an S corporation?
> Describe the advantages (if any) of using a reverse triangular form of Type A reorganization in acquiring other corporations.
> Lauren is 17 years old. She reports earned income of $3,000 and unearned income of $6,200. Is it likely that she is subject to the kiddie tax? Explain.
> Gerry (age 56) and Elaine (age 54) have been married for 12 years and file a joint tax return. The couple lives in an apartment in downtown Manhattan. Gerry’s father, Mortey, recently retired from Del Boca Vista Corporation (DBVC), where he worked for ma
> While James Craig and his former classmate Paul Dolittle both studied accounting at school, they ended up pursuing careers in professional cake decorating. Their company, Good to Eat (GTE), specializes in custom-sculpted cakes for weddings, birthdays, an
> Abigail, Bobby, and Claudia are equal owners in Lafter, an S corporation that was a C corporation several years ago. While Abigail and Bobby actively participate in running the company, Claudia has a separate day job and is a passive owner. Consider the
> Barry Potter and Winnie Weasley are considering making an S election on March 1, 2020, for their C corporation, Omniocular. However, first they want to consider the implications of the following information: • Winnie is a U.S. citizen a
> Ray and Chuck own 50 percent capital and profits interests in Alpine Properties LLC. Alpine builds and manages rental real estate, and Ray and Chuck each work full time (over 1,000 hours per year) managing Alpine. Alpine’s debt (both at the beginning and
> Until the end of year 0, Magic Carpets (MC) was a C corporation with a calendar year. At the beginning of year 1 it elected to be taxed as an S corporation. MC uses the LIFO method to value its inventory. At the end of year 0, under the LIFO method, its
> Jane has been operating Mansfield Park as a C corporation and decides she would like to make an S election. What is the earliest the election will become effective under each of these alternative scenarios? a) Jane is on top of things and makes the elect
> Farve Inc. recently elected S corporation status. At the time of the election, the company had $10,000 of accumulated earnings and profits and a net unrealized gain of $1,000,000 associated with land it had invested in (although some parcels had an unrea
> Mark is the sole shareholder of Tex Corporation. Mark first formed Tex as a C corporation. However, in an attempt to avoid having Tex’s income double taxed, Mark elected S corporation status for Tex several years ago. On December 31, 2019, Tex reports $5
> Jack, a geologist, had been debating for years whether or not to venture out on his own and operate his own business. He had developed a lot of solid relationships with clients and he believed that many of them would follow him if he were to leave his cu
> Wood Corporation was a C corporation in 2018 but elected to be taxed as an S corporation in 2019. At the end of 2018, its earnings and profits were $15,500. The following table reports Wood’s (taxable) income for 2019 (its first year as an S corporation)
> Tempe Corporation is a calendar-year corporation. At the beginning of 2019, its election to be taxed as an S corporation became effective. Tempe Corp.’s balance sheet at the end of 2018 reflected the following assets (it did not have an
> Virginia Corporation is a calendar-year corporation. At the beginning of 2019, its election to be taxed as an S corporation became effective. Virginia Corp.’s balance sheet at the end of 2018 reflected the following assets (it did not h
> Rivendell Corporation uses the accrual method of accounting and has the following assets as of the end of 2018. Rivendell converted to an S corporation on January 1, 2019. a) What is Rivendell’s net unrealized built-in gain at the time
> Last year, Miley decided to terminate the S corporation election of her solely owned corporation on October 17, 2018 (effective immediately), in preparation for taking it public. At the time of the election, the corporation had an accumulated adjustments
> WAR (We Are Rich) has been in business since 1985. WAR is an accrual method sole proprietorship that deals in the manufacturing and wholesaling of various types of golf equipment. Hack & Hack CPAs has filed accurate tax returns for WARâ€&#
> Using the facts from problem 57, Oriole Corporation proposes to pay Larry $100,000 and give him an installment note that will pay him $30,000 per year for the next 10 years plus a market rate of interest. Will this arrangement allow Larry to treat the re
> Sarah (single) purchased a home on January 1, 2008, for $600,000. She eventually sold the home for $800,000. What amount of the $200,000 gain on the sale does Sarah recognize in each of the following alternative situations? (Assume accumulated depreciati
> Which of the following items is not a permanent book–tax difference? a) Tax-exempt interest income. b) Tax-exempt insurance proceeds. c) Windfall tax benefits from the exercise of an NQO d) Meal expenses. e) First-year expensing under §179.
> Ralph operates a business that acts as a sales representative for a large firm that produces and sells precious metals to electronic manufacturers. Ralph contacts manufacturers and convinces them to sign contracts for delivery of metals. Ralph’s company
> Chandra was the sole shareholder of Pet Emporium that was originally formed as an S corporation. When Pet Emporium terminated its S election on August 31, 2018, Chandra had a stock basis and an at-risk amount of $0. Chandra also had a suspended loss from
> Timo is the sole owner of Jazz Inc., an S corporation. On October 31, 2019, Timo executed an unsecured demand promissory note of $15,000 and transferred the note to Jazz (Jazz could require Timo to pay it $15,000 on demand). When Timo transferred the not
> Your client, Midwest Products Inc. (MPI), is a closely held, calendar-year, accrual-method corporation located in Fowlerville, Michigan. MPI has two operating divisions. One division manufactures lawn and garden furniture and decorative objects (furnitur
> Identify the following items as creating a temporary book–tax difference, permanent book–tax difference, or no book–tax difference.
> In its first year of existence (year 1), Willow Corp. (a C corporation) reports a loss for tax purposes of $50,000. In year 2 it reports a $40,000 loss. For year 3, it reports taxable income from operations of $100,000 before any loss carryovers. How muc
> Rajiv and Laurie Amin are recent college graduates looking to purchase a new home. They are purchasing a $200,000 home by paying $20,000 down and borrowing the other $180,000 with a 30-year loan secured by the home. The Amins have the option of (1) payin
> Using the facts in problem 51, what is the minimum tax that Pedro should pay to make the tax structure vertically equitable with respect to the amount of tax paid? This would result in what type of tax rate structure? Facts in Problem 51:
> Waco Leather Inc., a U.S. corporation, reported total taxable income of $5 million. Taxable income included $1.5 million of foreign source taxable income from the company’s branch operations in Mexico. All of the branch income is foreign branch income. W
> Selected accounts from GermX Co.’s adjusted trial balance for the year ended December 31 follow. Pre- pare the assets section of a classified balance sheet. Hint: Fair Value Adjustment—Trading increases trading securities; Fair Value Adjustment—Stock dec
> F varies jointly as q1 and q2 and inversely as the square of d. If F = 80 when q1 = 4, q2 = 16, and d = 0.4, determine F when q1 = 12, q2 = 20, and d = 0.2. (a)Write the variation equation an (b) determine the quantity indicated.
> One square meter equals 10,000 cm2. Use this information to convert the following. 0.75 m2 to square centimeters
> Graph the system of linear inequalities and indicate the solution set. 3x - 2y ( 6 x - y ≤ 3
> Graph the solution set of the inequality, where x is an integer, on the number line.
> 4x + 2y = 2 3x - 2y = 12 Solve the system of equations by the addition method. If the system does not have a single ordered pair as a solution, state whether the system is inconsistent or dependent.
> S varies jointly as I and the square of T. If S = 4 when I = 10 and T = 4, determine S when I = 4 and T = 6. (a)Write the variation equation an (b) determine the quantity indicated.
> One square yard equals 9 ft 2. Use this information to convert the following. 48.1 yd2 to square feet
> x + y < 4 3x + 2y ( 6 Graph the system of linear inequalities and indicate the solution set.
> Graph the solution set of the inequality, where x is an integer, on the number line.
> Solve the system of equations by the substitution method. If the system does not have a single ordered pair as a solution, state whether the system is inconsistent or dependent. 2x + y = 12
> Fill in the blank with an appropriate word, phrase, or symbol(s). 2. A special type of relation where each value of the independent variable corresponds to a unique value of the dependent variable is called a(n)________ . 4. The set of values obtained fo
> (a)Write the variation equation an (b) determine the quantity indicated. A varies directly as the square of B. If A = 245 when B = 7, determine A when B = 12.
> One square yard equals 9 ft 2. Use this information to convert the following. 396 ft2 to square yards
> 4x + 2y > 8 y ≤ x + 1 Graph the system of linear inequalities and indicate the solution set.
> Graph the solution set of the inequality, where x is an integer, on the number line. x + 9 ( 5
> x - y = -1 y = 2x + 4 Solve the system of equations by the substitution method. If the system does not have a single ordered pair as a solution, state whether the system is inconsistent or dependent.
> (a)Write the variation equation an (b) determine the quantity indicated. C varies inversely as J. If C = 7 when J = 0.7, determine C when J = 14.
> Determine the shaded area. When appropriate, use the / key on your calculator and round your answer to the nearest hundredth. Answer: 32. Radius of circles: 6 = 3 mm Area of 4 circles: p (3)2 = 9p = 28.27433388 mm2 Area of rectangle: 24(6) = 144 mm2
> 3x - y ≤ 6 y < x – 4 Graph the system of linear inequalities and indicate the solution set.
> Graph the solution set of the inequality, where x is an integer, on the number line. 5x ( 45
> x = 5y - 12 x - y = 0 Solve the system of equations by the substitution method. If the system does not have a single ordered pair as a solution, state whether the system is inconsistent or dependent.
> Fill in the blank with an appropriate word, phrase, or symbol(s). 2. An expression that contains two terms in which each exponent that appears on a variable is a whole number is called a(n)________ . 4. The property that indicates that if the product of
> (a)Write the variation equation an (b) determine the quantity indicated. A varies jointly as R1 and R2 and inversely as the square of L. Determine A when R1 = 120, R2 = 8, L = 5, and k = /
> Determine the shaded area. When appropriate, use the key on your calculator and round your answer to the nearest hundredth.
> y ≤ 3x – 4 Draw the graph of the inequality.
> Graph the solution set of the inequality, where x is an integer, on the number line. -2 ( x
> Fill in the missing values. (28). 42.9 hg = _________ g (30). 8 dam = _________ m (32). 9.32 m ℓ = _________ℓ
> x + y = 3 y + x = 5 Solve the system of equations by the substitution method. If the system does not have a single ordered pair as a solution, state whether the system is inconsistent or dependent.
> (a)Write the variation equation an (b) determine the quantity indicated. M varies directly as J and inversely as C. Determine M when J = 12, C = 16, and k = 4.
> Determine the shaded area. When appropriate, use the key on your calculator and round your answer to the nearest hundredth.
> y ( -2x + 1 Draw the graph of the inequality.
> Graph the solution set of the inequality, where x is a real number, on the number line.
> Fill in the blanks with an appropriate word, phrase, or symbol(s). 2. The amount of cash the buyer must pay to the seller before the lending institution will grant the buyer a mortgage is known as the payment__________. 4. The final step of purchasing a
> 4x - y = 2 2x - y = 6 Solve the system of equations by the substitution method. If the system does not have a single ordered pair as a solution, state whether the system is inconsistent or dependent.
> (a)Write the variation equation an (b) determine the quantity indicated. R varies directly as the square of s. Determine r when s = 2 and k = 13.
> Determine the shaded area. When appropriate, use the key on your calculator and round your answer to the nearest hundredth.
> Draw the graph of the inequality. x + 2y ≤ 0
> Graph the solution set of the inequality, where x is a real number, on the number line. -4 ( x ( 1
> y = 2x - 1 y = 3x - 4 Solve the system of equations by the substitution method. If the system does not have a single ordered pair as a solution, state whether the system is inconsistent or dependent.
> 2. When one quantity increases while the other quantity decreases, it is an example of________ variation. 4. In the equation y = ox, k is called the constant of___________.
> Fill in the blanks with an appropriate word, phrase, or symbol(s). 2. In a right triangle, the side that is opposite the right angleis called the _________. 4. (a) A line segment from the center of a circle to any point on the circle is called the ______
> Fill in the blank with an appropriate word, phrase, or symbol(s). (a) a ( b means that a is________ than b. (b) a ( b means that a is_________ than b. 4. When solving an inequality, if you obtain a statement that is always false, such as 3 ( 5, the answe
> x varies inversely as y. Determine x when y = 15 and k = 45. (a)Write the variation equation an (b) determine the quantity indicated.
> 2. The amount of money that is present in an ordinary annuity after t years is known as the accumulated amount or the _____value of the annuity. 4. A variable annuity is an annuity that is invested in stocks, bonds, mutual funds, or other investments th
> Prime Interest Rate Nick borrowed $600 for 3 months. The banker said that Nick must repay the loan at the rate of $200 per month plus interest. The bank was charging a rate of 2 percentage points above the prime interest rate. The prime interest rate is
> U.S. Treasury Bills On December 3, 2014, Trinity purchased a 364-day, $6000 U.S. Treasury bill at a 0.12% discount. (See Exercise 55.) (a) What is the date of maturity of the Treasury bill? (b) How much did Trinity actually pay for the Treasury bill? (c)
> Flag Company Loan On April 3, the Mears Flag Company borrowed $15,000 to pay for start-up costs for its new showroom. The loan had a simple interest rate of 8.25% and was for 270 days. The company was able to make partial payments of $6000 on May 28 and
> A partial payment is made on the date(s) indicated. Use the United States rule to determine the balance due on the note at the date of maturity. The Effective Date is the date the note was written. Assume the year is not a leap year. Where appropriate, r
> A partial payment is made on the date(s) indicated. Use the United States rule to determine the balance due on the note at the date of maturity. The Effective Date is the date the note was written. Assume the year is not a leap year. Where appropriate, r
