Answer:
$1,050,000
Explanation:
Calculation to determine what the company should report as a liability for unredeemed coupons
Liability for unredeemed coupons =($800,000 x 0.70 ) - $350,000 ) x $5.00
Liability for unredeemed coupons=($560,000-$350,000)×$5.00
Liability for unredeemed coupons=$210,000x $5.00
Liability for unredeemed coupons=$1,050,000
Therefore At December 31, 2021, the company should report a liability for unredeemed coupons of:$1,050,000
Marcia, a single individual, has qualified trade or business income after all applicable deductions of $240,000. Her business paid $80,000 of W-2 wages this year and has $50,000 of tangible business property. Required: Compute Marcia's QBI deduction, assuming her overall taxable income before QBI is $300,000. Compute Marcia's QBI deduction, assuming her overall taxable income before QBI is $180,000.
Answer:
Compute Marcia's QBI deduction, assuming her overall taxable income before QBI is $300,000.
$40,000Compute Marcia's QBI deduction, assuming her overall taxable income before QBI is $180,000.
$36,000Explanation:
Marcia's QBI deduction limits:
lower between 20% of QBI or taxable income
$240,000 x 20% = $48,000
$300,000 x 20% = $60,000
or
higher between 50% of wages or 25% of wages + 2.5% of business property
$80,000 x 50% = $40,000
($80,000 x 25%) + (2.5% x $50,000) = $21,250
Marcia's QBI deduction limits:
lower between 20% of QBI or taxable income
$180,000 x 20% = $36,000
$300,000 x 20% = $60,000
or
higher between 50% of wages or 25% of wages + 2.5% of business property
$80,000 x 50% = $40,000
($80,000 x 25%) + (2.5% x $50,000) = $21,250
On December 1, 2011, the Itami Wholesale Co. is attempting to project cash receipts and disbursements through January 31, 2012. On this latter date, a note will be payable in the amount of $100,000. This amount was borrowed in September to carry the company through the seasonal peak in November and December.
Selected general ledger balances on December 1 are as follows:
Cash $ 88,000
Inventory 65,200
Accounts payable 136,000
Sales terms call for a 3% discount if payment is made within the first 10 days of the month after sale, with the balance due by the end of the month after sale. Experience has shown that 50% of the billings will be collected within the discount period, 30% by the end of the month after purchase, and 14% in the following month. The remaining 6% will be uncollectible. There are no cash sales. The average selling price of the company’s products is $100 per unit. Actual and projected sales are as follows:
October actual $ 280,000
November actual 320,000
December estimated 330,000
January estimated 250,000
February estimated 240,000
Total estimated for year ending June 30, 2012 $2,400,000
All purchases are payable within 15 days. Approximately 60% of the purchases in a month are paid that month, and the rest the following month. The average unit purchase cost is $80. Target ending inventories are 500 units plus 10% of the next month’s unit sales. Total budgeted marketing, distribution, and customer-service costs for the year are $600,000. Of this amount, $120,000 are considered fixed (and include depreciation of $30,000). The remainder varies with sales. Both fixed and variable marketing, distribution, and customer-service costs are paid as incurred.
Required:
Prepare a cash budget for December 2011 and January 2012. Supply supporting schedules for collections of receivables; payments for merchandise; and marketing, distribution, and customer-service costs.
Answer:
Itami Wholesale Co.
Cash Budget
December January
Beginning balance $88,000 $47,190
Cash collections 295,250 265,050
Total cash receipts $383,250 $312,240
Cash Disbursements:
Note payable $100,000
Payment for purchases $262,560 222,080
Payment for marketing,
distribution, and
customer-service 73,500 57,500
Total disbursements $336,060 $375,580
Ending cash balance $47,190 ($67,340)
Explanation:
a) Data and Calculations:
Inventory beginning balance = $65,200
Accounts payable beginning balance = $136,000
Sales:
50% collected ($ - 3%)
30% second month
14% third month
6% uncollectible
Actual and projected Sales:
October November December January February
Actual sales $280,000 $320,000
Estimated sales $330,000 $250,000 $240,000
50% collected ($ - 3%) $160,050 $121,250 $116,400
30% second month 96,000 99,000 75,000
14% third month 39,200 44,800 46,200
Total cash collections $295,250 $265,050 $237,600
Payment for merchandise: November December January February
Ending inventory 820 830 750 740
Sales in units 3,200 3,300 2,500 2,400
Units available for sale 4,020 4,130 3,250 3,140
Beginning inventory 780 820 830 750
Purchases 3,240 3,310 2,420 2,390
Cost of purchases $259,200 $264,800 $193,600 $191,200
Payment:
60% purchase month 155,520 158,880 116,160 114,720
40% the following month 103,680 105,920 77,440
Total payment for purchases $262,560 $222,080 $192,160
Budgeted marketing, distribution, and customer-service costs for the year = $600,000
Fixed cost = $120,000
Depreciation = $30,000
Cash payment for fixed cost = $90,000
Monthly payment for fixed cost = $7,500
Variable cost for the year = $480,000 ($600,000 - $120,000)
December = $330,000/$2,400,000 * $480,000 = $66,000
January = $250,000/$2,400,000 * $480,000 = $50,000
December January
Fixed cost payment $7,500 $7,500
Variable cost payment 66,000 50,000
Total cash payment $73,500 $57,500