Business, 26.01.2021 03:20 Sanonymous

Spencer, who itemizes deductions, had adjusted gross income of $60,000 for the current year. The following additional information is available for the year: Cash Contribution to Church $4,000
Purchase of art object at church bazaar
(with a fair market value of $800 on the date of purchase) 1,200
Donation of used clothing to Salvation Army
(fair value evidenced by receipt received) 600
What is the maximum amount Spencer can claim as a deduction for charitable contributions in the current year?

Answers: 1

Show answers

Answers

Answer from: stankyweezle

The maximum amount Spencer can claim as a deduction for charitable contributions in the current year is $5,000.

Explanation:

The following are the list of allowable deductions:

Cash Contribution to Church = $4,000

Excess of amount paid for art object at church bazaar over fair market value = $1,200 - $800 = $400

Fair market value used clothing donated to Salvation Army = $600

Total allowable deductions = Cash Contribution to Church + Excess of amount paid for art object at church bazaar over fair market value + Fair market value used clothing donated to Salvation Army = $4,000 + $400 + $600 = $5,000

The decision rule is that the total allowable deduction must be less than the 50% of adjusted gross income ceiling.

50% of adjusted gross income = Adjusted gross income * 50% = $60,000 * 50% = $30,000

Since the total allowable deductions of $5,000 is less than the $30,000 which is 50% of adjusted gross income, the maximum amount Spencer can claim as a deduction for charitable contributions in the current year is $5,000.

Answer from: Quest

Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan

Answer from: Quest

answer(d) all of the choices are correct;

Other questions on the subject: Business

Business, 22.06.2019 09:40, cerna

Alpha industries is considering a project with an initial cost of $8 million. the project will produce cash inflows of $1.49 million per year for 8 years. the project has the same risk as the firm. the firm has a pretax cost of debt of 5.61 percent and a cost of equity of 11.27 percent. the debt–equity ratio is .60 and the tax rate is 35 percent. what is the net present value of the project?

Answers: 1

continue

Business, 22.06.2019 10:40, meillsss

Parks corporation is considering an investment proposal in which a working capital investment of $10,000 would be required. the investment would provide cash inflows of $2,000 per year for six years. the working capital would be released for use elsewhere when the project is completed. if the company's discount rate is 10%, the investment's net present value is closest to (ignore income taxes) ?

Answers: 1

continue

Business, 22.06.2019 14:30, adenn3693

In our daily interactions we can find ourselves listening to other people solely for the purpose of finding weakness in their positions so that we can formulate a convincing response. select one: true false

Answers: 1

continue

Business, 22.06.2019 21:50, peno211

Required: 1-a. the marketing manager argues that a $5,000 increase in the monthly advertising budget would increase monthly sales by $9,000. calculate the increase or decrease in net operating income. 1-b. should the advertising budget be increased ? yes no hintsreferencesebook & resources hint #1 check my work 8.value: 1.00 pointsrequired information 2-a. refer to the original data. management is considering using higher-quality components that would increase the variable expense by $2 per unit. the marketing manager believes that the higher-quality product would increase sales by 10% per month. calculate the change in total contribution margin. 2-b. should the higher-quality components be used? yes no

Answers: 1

continue

You know the right answer?

Spencer, who itemizes deductions, had adjusted gross income of $60,000 for the current year. The fol...