Art is in the 28% marginal tax bracket for 2011. He owes a $10,000 bill for business
Question:
Art is in the 28% marginal tax bracket for 2011. He owes a $10,000 bill for business expenses. Because he reports taxable income on a cash basis, he can deduct the $10,000 in either 2011 or 2012, depending on when he makes the payment. He can pay the bill at any time before January 31, 2012, without incurring the normal 8% interest charge. If he expects to be in a 33% marginal tax bracket for 2012, should he pay the bill and claim the deduction in 2011 or 2012?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 54% (11 reviews)
Art should pay the expense and claim the deduction in 2012 In t...View the full answer
Answered By
Anthony Ngatia
I have three academic degrees i.e bachelors degree in Education(English & Literature),bachelors degree in business administration(entrepreneurship option),and masters degree in business administration(strategic management) in addition to a diploma in business management.I have spent much of my life in the academia where I have taught at high school,middle level colleges level and at university level.I have been an active academic essays writer since 2011 where I have worked with some of the most reputable essay companies based in Europe and in the US.I have over the years perfected my academic writing skills as a result of tackling numerous different assignments.I do not plagiarize and I maintain competitive quality in all the assignments that I handle.I am driven by strong work ethics and a firm conviction that I should "Do Unto others as I would Like them to do to me".
4.80+
76+ Reviews
152+ Question Solved
Related Book For
Concepts In Federal Taxation
ISBN: 9780324379556
19th Edition
Authors: Kevin E. Murphy, Mark Higgins, Tonya K. Flesher
Question Posted:
Students also viewed these Business Law questions
-
Art is in the 28% marginal tax bracket for 2016. He owes a $10,000 bill for business expenses. Since he reports taxable income on a cash basis, he can deduct the $10,000 in either 2016 or 2017,...
-
Art is in the 24 percent marginal tax bracket for 2020. He owes a $10,000 bill for business expenses. Because he reports taxable income on a cash basis, he can deduct the $10,000 in either 2020 or...
-
An investor is in the 28 percent income tax bracket and can earn 6.3 percent on a nontaxable bond. What is the comparable yield on a taxable bond? If this same investor can earn 8.9 percent on a...
-
In a law firm consisting of 20 lawyers, 9 are criminal lawyers, 6 are divorce lawyers, and 4 are both criminal and divorce lawyers. If a lawyer from this firm is chosen at random, what is the...
-
You wish to separate two proteins in solution by selectively precipitating one of them. What method could you use other than salting out?
-
Integrity Accounting Firm provides various financial services to organizations. Integrity has decided to price its jobs at the total variable costs of the job plus 15 percent. The job for a...
-
During a quality assurance check, the actual weights (in kilograms) of eight sacks of cement were recorded as 20.5, 19.4, 19.6, 18.0, 21.0, 20.2, 20.4, and 20.9. (a) Find the mean and the median of...
-
Sayaka Tar and Gravel Ltd. operates a road construction business. In its first year of operations, the company obtained a contract to construct a road for the municipality of Cochrane West, and it is...
-
Alpine Township contracts with Dragoon Environmental Services (DES) to provide solid waste collection to households and businesses. Until recently, DES had an exclusive franchise to provide this...
-
Uhura Resort opened for business on June 1 with eight air-conditioned units. Its trial balance on August 31 is as follows. Other data:1. The balance in prepaid insurance is a one-year premium paid on...
-
Inga, an attorney, completed a job for a client in November 2011. If she bills the client immediately, she will receive her $10,000 fee before the end of the year. By delaying the billing for a...
-
Elki would like to invest $50,000 in tax-exempt securities. He now has the money invested in a certificate of deposit that pays 5.75% annually. What rate of interest would the tax-exempt security...
-
Kamal is starting a new business which will operate as an S corporation. This means that income earned by the corporation will be reported by shareholders even if they do not receive distributions....
-
FIN 5130 Mini-case 2 Real World Application: IPOs This assignment will require you to obtain relevant information regarding IPOs. Important Websites/Information: 1. IPO Calendar (provided by Nasdaq):...
-
Cullumber Company traded machinery with a book value of $ 4 9 0 0 0 0 and a fair value of $ 1 0 6 0 0 0 0 . It received in exchange from Vaughn Manufacturing a machine with a fair value of $ 9 5 4 0...
-
4. Consider the IVP t y +1 y(0) = yo- (a) Without solving, determine all values of yo for which the IVP is certain to have a unique solution. (b) Solve the IVP for all such values of yo and detemine...
-
Northwood Company manufactures basketballs. The company has a ball that sells for $ 2 5 . At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus,...
-
At the beginning of 2 0 2 4 , VHF Industries acquired a machine with a fair value of $ 6 , 0 7 4 , 7 0 0 by signing a four - year lease. The lease is payable in four annual payments of $ 2 million at...
-
This exercise concerns some properties of the Black-Scholes formulas (2.2.3) and (2.2.4). (a) Consider a call option. If T is very small, the option will be ready to be exercised practically...
-
As water moves through the hydrologic cycle, water quality changes are common because of natural phenomena or anthropogenic pollution. Using Figure 11.1, describe how water-quality changes occur...
-
Document the flow of a project work process. Be sure to identify the starting and ending points.
-
Why is it important for marketers to think of a good or a service as a total product offering?
-
What part of the product life cycle would a product like the energy drink Red Bull be in? What about Gatorade?
-
How are brand loyalty, specialty goods and services, and prestige pricing related?
-
What is Fibonacci heap? Explain CONSOLIDATE operation with suitable example for Fibonacci heap ?
-
Discuss the impact of global supply chain disruptions, exacerbated by events like the COVID-19 pandemic, on inventory management strategies and market resilience across various industries?
-
A pharmaceutical retailer decided to host a website for home delivery of medicines according to user orders. The web application is deployed on a single Amazon EC2 instances. within a few months, the...
Study smarter with the SolutionInn App