Mr. and Mrs. Hunt have the following allowable itemized deductions this year. ? Medical expenses$3,275State and local taxes$7,400Casualty loss$3,990Charitable contributions$3,500Determine the effect on the amount of each deduction if the Hunts engage in a transaction generating $10,000 additional AGI this year.
What will be an ideal response?
Medical expense deduction is reduced by $1,000 ($10,000 × 10%) to $2,275 ($3,275 ? $1,000). Casualty loss is reduced by $100 (per loss limit) and $1,000 ($10,000 × 10%) to $2,890 ($3,990 - $100 - $1,000). State and local taxes and charitable contributions are unchanged.
You might also like to view...
Personal and professional titles, such as Mr., Ms., and Dr., should be omitted in the letter address section of a letter document
Indicate whether the statement is true or false
Explain the difference between passive and active listening. When is each type of listening appropriate?
What will be an ideal response?
Explain the reasons for the rapid growth of administrative agencies in the United States
What will be an ideal response?
The following is the adjusted trial balance as of December 31, 2017 of Peri Brothers, Inc
: Accounts Debit Credit Cash $ 18,000 Accounts Receivable 30,000 Prepaid Insurance 9,000 Office Supplies 3,200 Building 165,000 Accumulated Depreciation-Building $ 12,000 Equipment 88,000 Accumulated Depreciation-Equipment 8,500 Land 45,000 Accounts Payable 12,000 Salaries Payable 2,000 Unearned Service Revenue 25,000 Mortgage Payable 100,000 Common Stock 21,290 Dividends 25,840 Service Revenue 325,000 Salaries Expense 63,000 Depreciation Expense-Building and Equipment 6,250 Supplies Expense 15,000 Insurance Expense 14,500 Utilities Expense 23,000 _______ Total $505,790 $505,790 Provide the closing entry for expenses. What will be an ideal response