The sole proprietor of the FM2 Financial Services, Bondo, receives all accounting profits earned by her firm and a K28,000-a-year salary she pays herself. It is noteworthy that she also has a standing salary offer of K35,000 a year if she agrees to work for Bank of Zambia. If she had invested her capital outside her own company, she estimates that would have made a return of K22,000 a year. Further, information has reached you that last year, Bondo's accounting profit was K50,000. Calculate her economic profit?
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- Camila Juárez owns a successful law firm, her core business is corporate law, but occasionally Camila also works with mandates from wealthy clients requesting assistance in private legal matters. You are Camila's financial advisor, and she asks you to help her decide which of the private mandates she should accept. You estimate that Camila's opportunity cost of capital is 15% per effective annual and that she gives up $100,000 in monthly income from corporate work (assume this income is paid at the end of each month) if she accepts a private mandate. Camila is also interested in working for another private client B who is willing to pay her $140,000 per month, at the end of each month after receiving the mandate. This mandate would last 6 months, during which time Camila would receive monthly cash flows of $140,000. However, this job requires Camila to do some research for the next 2 months (starting today, before the mandate begins) to convince the client that she is the right person…Mulalo requires R100 000 in finance to start her business. Mr Khumalo, her father, has agreed to provide her with R50 000 as capital and in return, she will pay him 2% of the profits she makes each year. SABSA Bank agreed to provide her with a loan of R50 000 which she will pay off in 5 equal instalments. Interest on this loan is 10% per annum. Mulalo has already secured an order for 12 evening dresses for the 12 Miss South Africa contestants. Required: From the scenario above, identify three users of financial information and explain how they benefit from accounting information supplied.During the year, Mina earned the following. • Rent received during trip in Macau for properties in Bulacan, P370,000. • Gain on sale of technical gadgets stored in Cavite, P120,000. The sale was perfected in Hong Kong. • Business income of a service business in Ireland, P600,000. • Interest income from a resident debtor collected whilst on business travel in Phnom Penh, P40,000. • Compensation income from a domestic employer, P420,000. • Consultancy fees for professional services rendered to an Filipino company, P100,000. • Increase in the fair value of domestic stocks, P80,000. If Mina is a resident citizen, how much is her total income liable to income tax? 720,000 800,000 1,650,00 1,730,000
- During the year, Mina earned the following. • Rent received during trip in Macau for properties in Bulacan, P370,000. • Gain on sale of technical gadgets stored in Cavite, P120,000. The sale was perfected in Hong Kong. • Business income of a service business in Ireland, P600,000. • Interest income from a resident debtor collected whilst on business travel in Phnom Penh, P40,000. • Compensation income from a domestic employer, P420,000. • Consultancy fees for professional services rendered to an Filipino company, P100,000. • Increase in the fair value of domestic stocks, P80,000. If Mina is a resident alien, how much is her total income liable to income tax? A. 720,000 B. 930,000 C. 1,010,000 D. 1,650,000During the year, Mina earned the following. • Rent received during trip in Macau for properties in Bulacan, P370,000. • Gain on sale of technical gadgets stored in Cavite, P120,000. The sale was perfected in Hong Kong. • Business income of a service business in Ireland, P600,000. • Interest income from a resident debtor collected whilst on business travel in Phnom Penh, P40,000. • Compensation income from a domestic employer, P420,000. • Consultancy fees for professional services rendered to an Filipino company, P100,000. • Increase in the fair value of domestic stocks, P80,000. If Mina is a resident citizen, how much is her total income liable to income tax? A. 720,000 B. 800,000 C. 1,650,000 D. 1,730,000 If Mina is a resident alien, how much is her total income liable to income tax? A. 720,000 B. 930,000 C. 1,010,000 D. 1,650,000During the year, Mina earned the following. • Rent received during trip in Macau for properties in Bulacan, P370,000. • Gain on sale of technical gadgets stored in Cavite, P120,000. The sale was perfected in Hong Kong . • Business income of a service business in Ireland, P600,000. • Interest income from a resident debtor collected whilst on business travel in Phnom Penh, P40,000 . • Compensation income from a domestic employer, P420,000. • Consultancy fees for professional services rendered to an Filipino company, P100,000 . • Increase in the fair value of domestic stocks, P80,000. If Mina is a resident citizen, how much is her total income liable to income tax? If Mina is a resident alien, how much is her total income liable to income tax?
- During the year, Sabrina earned the following. Rent received during trip in Macau for properties in Bulacan, P370,000. Gain on sale of technical gadgets stored in Cavite, P120,000. The sale was perfected in Hong Kong. Business income of a service business in Ireland, P600,000. Interest income from a resident debtor collected whilst on business travel in Phnom Penh, P40,000. Compensation income from a domestic employer, P420,000. Consultancy fees for professional services rendered to an Filipino company, P100,000. Increase in the fair value of domestic stocks, P80,000. Question: 1. If Sabrina is a resident citizen, how much is her total income liable to income tax? 2. If Sabrina is a resident alien, how much is her total income liable to income tax?D, E, and F are partners in DEF Enterprises. They want to obtain a loan from X, but X does not know any of them, so they asked Y, who is known to X, to represent himself as a partner in DEF Enterprises. X, believing that Y is a partner in DEF enterprises, thus grants the loan of Php180,000.00 to DEF Enterprises. Later, however, DEF Enterprises is unable to pay the loan as its assets amount only to Php120,000.00. How does the payment of the loan be settled: a. D, E, and F shall share in the payment of Php180,000.00 from their separate assets at Php60,000.00 each. b. The assets of DEF Enterprises shall first be exhausted. Thereafter, D, E, and F may be held liable by X from their separate assets at Php20,000.00 each. c. D, E, F, and Y shall share in the payment of Php180,000.00 from their separate assets at Php45,000.00 each. d. The assets of DEF Enterprises shall first be exhausted. Thereafter, D, E, F, and Y may be held liable by Z from their separate assets at Php15,000.00…Lileth Adriano, who plans to go abroad, is selling her mini-donut business. Her friend, Benita Solido is interested to buy it but can only afford to pay P350,000. The following are the assets of Adriano’s business: a. How much is the net worth assuming there is a mortgage note of P150,000 attached to the equipment? b. Will Benita Solido be able to afford to buy the business? c. Make the entry in the books of Benita. Book Value Market Value Equipment (net of accumulated depreciation of P25,000) P350,000 P300,000 Furniture and Fixtures (net of accumulated depreciation of P5,000) 75,000 50,000 Raw Materials 35,000 25,000 Franchise Right 150,000 100,000 Total P610,000 P475,
- G, the Manager of ABC Co., was given a fringe benefit of a Household Expense account for the salary of his driver and other personal expenses in the amount of P20,000 per month for the current year. Compute the following: 1) Grossed Up Monetary of the Fringe Benefits 2) Fringe Benefits Tax Payable 3) If G is employed in an Offshore Banking unit, compute the fringe Benefits Tax. Upload your solutions in Spreadsheet Format.RT is about to loan his granddaughter Cynthia $20,000 for 1 year. RT’s TVOM, based upon his current investment earnings, is 8%. Cynthia’s TVOM, based upon earnings on investments, is 12%. Solve, a. Should they be able to successfully negotiate the terms of this loan? b. If so, what range of paybacks would be mutually satisfactory? If not, how far off is each person from an agreement?The store owner hires 2 sellers with a total payment fund of 150 thousand rubles per year. Pays a monthly rent of 60 thousand rubles. He invested his own capital of 300 thousand rubles in the business, donating 30 thousand rubles per annum, which he would have had with another placement of capital. He estimates his entrepreneurial talent at 100 thousand rubles a year. A large trading company offers him a place with a salary of 200 thousand rubles a year. Calculate the amount of accounting and economic costs and draw conclusions.
