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2 years ago

Which would be considered closed-end credit situations? Check all that apply.

2 answers:

7 0

Jason bought a used car and got a loan from his credit union
The Overtons bought a new home and mortgaged it for 30 years.
Tammy borrowed $40,000 in school loans to be paid back in 5 years.

anygoal [31]2 years ago

7 0

Answer:

1, 2 & 4.

Explanation:

Got it right on Edguentity :)

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A buyer is getting a fully amortized loan for $220,000. The bank will give the buyer the loan for 15 years at 5 1/2% or for 30 y

Vadim26 [7]

Answer:

Difference in monthly payment=$407.0339

Explanation:

Loan Amortization: A loan repayment method structured such that a series of equal periodic installments will be paid for certain number of periods to offset both the loan principal amount and the accrued interest.

The monthly installment is computed as follows:

Monthly installment= Loan amount/annuity factor

Loan amount; =220,000

Annuity factor = (1 - (1+r)^(-n))/r

r -monthly rate of interest, n- number of months

First option

monthly interest rate = 5.5% =0.458 %, n- 15×12

Annuity factor= (1-(1+0.055)^(-180 )/0.055 =122.38

Monthly repayment = 220,000/122.386 = 1797.58

Second option

r- 6.5%/12 = 0.542 % n = 15×12 = 180

Annuity factor = ( 1- (1+0.00542)^(-360))/0.005 42= 158.21

Monthly installment = 220,000/1390.549 = 1390.54

Difference in monthly payment = 1,797.583 - 1390.54 = 407.0339

Difference in monthly payment=407.0339

6 0

2 years ago

Lawrence Reed in his article "The Role of Incentive" states that the best way to curb pollution and misuse of resources is to?

katovenus [111]

Answer:

Like the title of the article states, all economy relayed choices are the results of an incentive or disincentive a potential polluter faces. He gave the example of the Lake Erie, stating that is highly reasonable (although highly unethical) it is polluted, as it is financially efficient to simply dump garbage in the lake, rather than invest in a recycling or waste management system. He also added, that since the lake is a public good, no one will look at the pollution as a serious concern, since it isn't owned by anybody.

All of this implies that a structured, incentive system has to be created in order to curb pollution.

7 0

2 years ago

Carey, a single taxpayer, purchased a rental house in 2018, which he actively manages. During 2018, Carey had a loss of $14,000

noname [10]

Answer:

$6,000

Explanation:

First, Carey's allowable deductions repersents 'real estate loss allowance. The real estate loss allowance is an allowance or tax reduction made available to taxpayers who are also owners of rental properties in the U.S.

The specific allowance states that if the adjusted gross income of the owner of the rental property is $100,000 or less, then the taxpayer is allowed a deduction of $25,000. However, this begins to reduce as the adjusted gross income approaches $150,000 and the allowance is completely eliminated when the income exceeds $150,000

Based on this explanation, Carey's Adjusted Gross Income= $138,000, higher than $100,000 but less than $150,000

The calculation= 50% ($150,000- maximum allowable adjusted gross income- $138,000 - Carey's reported adjusted gross income)

=0.50 ($12,000)

= $6,000

7 0

2 years ago

A major concern with Social Security is the possibility that funds will not be available when today’s tax-payers retire to becom

Karolina [17]

Answer:

...well Why cant the just . .

Explanation:

3 0

1 year ago

Read 2 more answers

Rank the following three single taxpayers in order of the magnitude of taxable income (from lowest to highest). (First mean high

Firlakuza [10]

Answer:

Ahmed's ranking is Third (Lowest Taxable Income)

Baker's ranking is Second

Chin's ranking is First (Highest Taxable Income)

Explanation:

In order to determine the rankings, lets compute each taxpayer's taxable income by making the necessary deductions as applicable. Taxable income calculated for each taxpayer below in serial order. Before we calculate, lets have an idea of how deductions are made.

AGI is defined as the adjusted gross income which is calculated as an individual's gross income minus the expenses that qualify as deductible. These expenses include the likes of contributions to the IRA, payment of interest on student loans, alimony payments, contributions to self-employment insurance, moving expenses, some business related expenses pertaining to educators, artists etc, and some rental expenses associated with a business activity. Therefore, intuitively, we can see that a taxpayer with the highest amount of deductions for AGI would benefit the most when calculating taxable income.

Itemized deductions are expenses that a taxpayer can incorporate to lower their taxable income by reducing their adjusted gross income (AGI). These include certain medical expenses, markup on house loans and charities. Taxpayer's can chose between either opting to deduct itemized expenses or standard deductions which is a fixed deduction allowed under tax law. Obviously, a taxpayer would go for the deduction amount which is the highest. Standard deduction is $ 5,950. Therefore, among the taxpayer's, the one with the highest amount of itemized deductions would benefit the most.

Lets calculate taxable income now.

(1) Ahmed

Gross Income: 80,000

Less Deduction for AGI: (8,000)

Adjusted Gross Income: 72,000

Less higher of itemized deduction or standard deduction: (5,950)

Taxable Income: 66,050

(2) Baker:

Gross Income: 80,000

Less Deduction for AGI: (4,000)

Adjusted Gross Income: 76,000

Less higher of itemized deduction or standard deduction: (5,950)

Taxable Income: 70,050

(3) Chin:

Gross Income: 80,000

Less Deduction for AGI: (0)

Adjust Gross Income: 80,000

Less higher of itemized deduction of standard deduction: (8,000)

Taxable Income: 72,000

As we can see from the above, since Ahmed has the highest deductions for AGI he has the lowed adjusted gross income. He can then take use of the fact that he can deduct a standard deduction of 5,950 (while not having any itemized deductions) to further lower his taxable income.

Chin did not have an deductions for AGI which made his taxable income the highest.

Note: Taxpayers can also deduct personal and dependency deductions but these have been excluded in the context of the question based on the assumption that these deductions have either not been made or would be equal for all three taxpayers. The answer would not be affected in either case.

5 0

2 years ago