answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
leva [86]
2 years ago
12

Jonathan (an individual) owns 100% of the stock of Husky, Inc. (a C corporation) and 100% of the stock of Calhoun, Inc. (another

C Corporation). Calhoun, Inc. is very successful and has millions in earnings and profits. Husky has not fared so well and has no earnings and profits. In the current year, Husky ran out of cash and could not make its payroll. Because of this situation, Jonathan directed Calhoun, Inc. to pay $100,000 in wages to employees of Husky. The $100,000 payment was not structured as a loan.
A. How should Calhoun, Inc. treat the $100,000 payment for tax purposes?
B. How should Jonathan treat the $100,000 payment for tax purposes?
Business
1 answer:
BaLLatris [955]2 years ago
8 0

Answer: A. As Expenses

B. No treatment.

Explanation:

A. The $100,000 was not structured and a loan so it will be accounted for as EXPENSES. This means that it will be deducted from the Income for the year from Calhoun's books.

B. A C Corporation is by definition taxed SEPARATELY from it's owners in the United States of America. Seeing as both Corporations were C Corporations, Jonathan as the owner of both companies need not worry about how he should treat the $100,000 payment as he will not ne taxed on it.

You might be interested in
St. Augustine Corporation originally budgeted for $360,000 of fixed overhead at 100% of normal production capacity. Production w
Ksju [112]

Answer:

$9,000 unfavorable

Explanation:

The computation of the total fixed overhead variance is shown below:

= Actual fixed overhead costs - Budgeted fixed overhead

where,

Budgeted fixed overhead  is $360,000

And, the Actual fixed overhead cost is computed below:

= Actual fixed overhead × Actual production  ÷ budgeted production

= $360,000 × 11,700 units ÷ 12,000 units

= $351,000

Now put these values to the above formula  

So, the value would equal to

= $351,000 - $360,000

= $9,000 unfavorable

5 0
1 year ago
Consider a household consisting of four college friends. The friends have made a commitment to live together for the next five y
Alinara [238K]

Answer:

Explanation:

Omaha Miami

Earnings Earnings Value of Quality Life Expense to Move to Miami Net Value Difference in Value

Alex 200000 180000 40000 5000 215000 15000

Bobby 120000 150000 40000 5000 185000 65000

Cory 315000 300000 25000 5000 320000 5000

Dana 150000 100000 25000 5000 120000 -30000

Tied mover – any person who moves with their partner even if the person's employment is better at the present location.

Assuming all the friends agree on moving to Miami, Dana will compromise in value, therefore, Dana is the Tied Mover.

Tied Stayer – any of them who stays with the partner at current location even if the person's employment opportunity is better somewhere else.

Assuming all the friends decided to be in Omaha, Alex, Bobby and Cory will compromise in value, therefore, Alex, Bobby and Cory are the Tied Stayers.

8 0
1 year ago
Why is it considered bad manners to leave the Subject field blank?
Bogdan [553]

It is noted as so due to the fact the reader would like to know the reasoning behind the message. Following that the bots used to monitor emails for scams, spam, or viruses typically send off empty subjects as a spam.

3 0
2 years ago
Read 2 more answers
Kiddy Toy Corporation needs to acquire the use of a machine to be used in its manufacturing process. The machine needed is manuf
xenn [34]

Answer:

Option A net worth  -215,906.03

Option B net worth  -210, 159.75

It is a better deal to use the machine through lease than purchase it as the net worth is lower.

Explanation:

Purchase the machine:

-164,000 purchase cost

PV of the maintenance cost

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C -9,000.00

time 10

rate 0.08

-9000 \times \frac{1-(1+0.08)^{-10} }{0.08} = PV\\

PV -$60,390.7326

PV of the salvage value

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity  14,000.00

time  10.00

rate  0.08000

\frac{14000}{(1 + 0.08)^{10} } = PV  

PV   6,484.7088

<em>net worth: </em>

-162,000 - 60,390.73 + 6,484.70 = -215,906.03

PV of the lease: (annuity-due)

C \times \frac{1-(1+r)^{-time} }{rate} (1+rate)= PV\\

C 29,000.00

time 10

rate 0.08

29000 \times \frac{1-(1+0.08)^{-10} }{0.08} (1+0.08) = PV\\

PV $210,159.7494

6 0
2 years ago
Marco traveled across three states to shop at Tiffany's to buy his girlfriend, Jana, a present. This is the only Tiffany's store
Llana [10]

Answer:

Exclusive.

Explanation:

In this scenario, Marco traveled across three states to shop at Tiffany's to buy his girlfriend, Jana, a present. This is the only Tiffany's store in the entire region. The degree of channel coverage for Tiffany's is exclusive.

In marketing, there are basically three (3) types of market channel coverage used by businesses;

1. Intensive market coverage: this involves a company extending its products to as many sales outlets as possible. Therefore, it's a saturation coverage of the market. Some examples are softdrinks, beer, or cigarettes company.

2. Selective market coverage: it involves a company using a limited number of sales outlets to sell its products in a region. Thus, it lie between an intensive distribution and exclusive market coverage.

3. Exclusive market coverage: this involves a company extending its products to only one sales outlets. Thus, it is the exact opposite of an intensive market coverage and a complex form of selective market coverage. It gives companies prestige and improves brand quality perceptions.

<em>Hence, the degree of channel coverage for Tiffany store is exclusive market coverage. </em>

6 0
2 years ago
Other questions:
  • Mountain Dental Services is a specialized dental practice whose only service is filling cavities. Mountain has recorded the foll
    7·1 answer
  • Kendra’s Quilts makes custom baby quilts embroidered with the baby’s name and date of birth. The company is considering the purc
    10·1 answer
  • Knowledge check <br> what are the possible weaknesses of this peer approach to valuation?
    12·1 answer
  • The internal monthly magazine and blog at the cosmetics firm Mary Kay serve as ________ for employees; the magazine and blog are
    15·1 answer
  • The Terrence Co. manufactures two products, Baubles and Trinkets. The following are projections for the coming year: Baubles Tri
    7·1 answer
  • The publisher of an economics textbook finds that, when the book's price is lowered from $70 to $60, sales rise from 10,000 to 1
    10·1 answer
  • Les moore retired as president of goodman snack foods company but is currently on a consulting contract for $35,000 per year for
    8·1 answer
  • It is January 1 of Year 2. Sales for Harry Company for January, February, and March are forecasted to be as follows: January, $2
    7·1 answer
  • In a company's standard costing system direct labor-hours are used as the base for applying variable manufacturing overhead cost
    11·1 answer
  • A commuter bus company uses two measures of activity, routes and commuters, in the cost formulas in its budgets and performance
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!