In 2016 Betty loaned her son, Juan, $10,000 to help him buy a car. In 2018, before he repaid the $10,000, Betty told Juan that she was "tearing up" the $10,000 note as a graduation present. How should Juan treat the amount forgiven?
A) taxable income in year of loan
B) taxable income in year of forgiveness
C) excludible gift in year of loan
D) excludible gift in year of forgiveness
D) excludible gift in year of forgiveness
The amount forgiven is an excludible gift in the year of forgiveness.
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Louisiana Specialty Foods can produce its famous meat pies at a rate of 1650 cases of 48 pies each per day. The firm distributes the pies to regional stores and restaurants at a steady rate of 250 cases per day
The cost of setup, cleanup, idle time in transition from other products to pies, etc., is $320. Annual holding costs are $11.50 per case. Assume 250 days per year. (a) Determine the optimum production run (batch size). (b) Determine the number of production runs per year. (c) Determine maximum inventory. (d) Determine total inventory-related (setup and carrying) costs per year (rounded to the nearest dollar).