Mitch is in the 24% tax bracket. He may receive a different tax benefit for a $2,000 expenditure that is classified as
a deduction from AGI than he will receive for a $2,000 expenditure that is classified as a deduction for AGI.
True
RATIONALE: The value of the tax benefit to Mitch for the deduction from AGI may be less than
that for the deduction for AGI. The value of the deduction for AGI for a taxpayer in
the 24% bracket for a $2,000 expenditure is $480 ($2,000 × 24%). If Mitch takes the
standard deduction rather than itemizing deductions, then the $2,000 expenditure that
is classified as a deduction from AGI has no tax benefit.

Find the expected net profit of an insurance company on a health-insurance policy if: the probability of a $5000 claim is 20%; the probability of a $1000 claim is 60%; the probability of a $20,000 claim is 10%, and the probability of no claim is 10%. the company charges $4000 for this coverage. interpret your answer.

Mae jong corp. issues $1,000,000 of 10% bonds payable which may be converted into 10,000 shares of $2 par value ordinary shares. the market rate of interest on similar bonds is 12%. interest is payable annually on december 31, and the bonds were issued for total proceeds of $1,000,000. in accounting for these bonds, mae jong corp. will: (a) first assign a value to the equity component, then determine the liability component. (b) assign no value to the equity component since the conversion privilege is not separable from the bond.(c) first assign a value to the liability component based on the face amount of the bond.(d) use the “with-and-without” method to value the compound instrument.

Acorporation a. can use different depreciation methods for tax and financial reporting purposes b. must use the straight - line depreciation method for tax purposes and double declining depreciation method financial reporting purposes c. must use different depreciation method for tax purposes, but strictly mandated depreciation methods for financial reporting purposes d. can use straight- line depreciation method for tax purposes and macrs depreciation method financial reporting purposes