All B María, age 32, earns $60,000 working in 2023. She has no other income. Her medical expenses for the year total $6,000. During the year, she suffers a casualty loss of $9,500 when her apartment is damaged by flood waters (part of a Federally declared disaster area). María contributes $6,000 to her church and pays $4,000 of state income taxes. On the advice of her friend, María is trying to decide whether to contribute $5,000 to a traditional IRA. Complete the table to show the effect the IRA contribution would have on María's itemized deductions. Gross income Contribution to IRA AGI With IRA Contribution (5,000) $ St S Itemized deductions: Charitable contribution State income taxes Medical expenses Casualty loss Total itemized deductions Without IRA Contribution SA SA A SA 0 SA S The $5,000 IRA contribution would contribution reduces her taxable income by $ SA María's itemized deductions by $ As a result, the $5,000 IRA A A St mmarly >> All Bookmarks Problem 6-42 (Algorithmic) (LO. 3) Henrietta, the owner of a very successful hotel chain in the Southeast, is exploring the possibility of expanding the chain into a city in the Northeast. She incurs $53,000 of expenses associated with this investigation. Based on the regulatory environment for hotels in the city, she decides not to expand. During the year, she also investigates opening a restaurant that will be part of a national restaurant chain. Her expenses for this are $53,000. She proceeds with opening the restaurant, and it begins operations on May 1. Determine the amount that Henrietta can deduct in the current year for investigating these two businesses. In your computations, round the per-month amount to two decimal places then use rounded amount in subsequent computations. Enter your final answers to the nearest whole dollar. a. The deductible amount of investigation expenses related to expansion of her hotel chain into another city: $ b. The deductible amount of investigation expenses related to opening a restaurant: $

All B María, age 32, earns $60,000 working in 2023. She has no other income. Her medical expenses for the year total $6,000. During the year, she suffers a casualty loss of $9,500 when her apartment is damaged by flood waters (part of a Federally declared disaster area). María contributes $6,000 to her church and pays $4,000 of state income taxes. On the advice of her friend, María is trying to decide whether to contribute $5,000 to a traditional IRA. Complete the table to show the effect the IRA contribution would have on María's itemized deductions. Gross income Contribution to IRA AGI With IRA Contribution (5,000) $ St S Itemized deductions: Charitable contribution State income taxes Medical expenses Casualty loss Total itemized deductions Without IRA Contribution SA SA A SA 0 SA S The $5,000 IRA contribution would contribution reduces her taxable income by $ SA María's itemized deductions by $ As a result, the $5,000 IRA A A St mmarly >> All Bookmarks Problem 6-42 (Algorithmic) (LO. 3) Henrietta, the owner of a very successful hotel chain in the Southeast, is exploring the possibility of expanding the chain into a city in the Northeast. She incurs $53,000 of expenses associated with this investigation. Based on the regulatory environment for hotels in the city, she decides not to expand. During the year, she also investigates opening a restaurant that will be part of a national restaurant chain. Her expenses for this are $53,000. She proceeds with opening the restaurant, and it begins operations on May 1. Determine the amount that Henrietta can deduct in the current year for investigating these two businesses. In your computations, round the per-month amount to two decimal places then use rounded amount in subsequent computations. Enter your final answers to the nearest whole dollar. a. The deductible amount of investigation expenses related to expansion of her hotel chain into another city: $ b. The deductible amount of investigation expenses related to opening a restaurant: $

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter26: Capital Budgeting (capbud)

Section: Chapter Questions

Problem 5R

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