What is the annual benefit of parents gifting bonds

Assignment Help Finance Basics
Reference no: EM13332174

Question 4 options:
What is the annual benefit of parents gifting bonds with annual investment income of $300 to their 10-year-old child if the parents are in the 35 percent and the child is in the 15 percent bracket?
(Round your answers to the nearest whole number. Omit the "$" sign in your response.)
Tax due if in parent’s name (a) =

Tax due if in child’s name (b) =

Annual Tax benefit [(a) - (b)] =

Save
________________________________________
Question 5


Question 5 options:
Laurence bought a classic car for $40,000 as a business investment opportunity. He was allowed to depreciate it over 10 years and take the amount as a business tax deduction on his return. At the end of 10 years, the car was sold for $40,000. If Laurence was in the 38 percent marginal tax bracket and could earn 8 percent after tax on the cash flow generated, what was his cumulative cash benefit after sale on this transaction?
(Round your answers to the nearest whole number. Omit the comma and "$" sign in your response.)
(a) Yearly Deductible Depreciation =

(b) Yearly Tax Benefit =

(c) Cumulative Tax Benefit (future value) =

(d) Tax on $40,000 Capital Gain =

(e) Net Cash earned [(c) - (d)] =

 

Reference no: EM13332174

Questions Cloud

How is the binding of hprg to heparin dependent on ph : Why does kininogen bind to glycosaminoglycans easily and why is the binding of kininogen less sensitive to physiological pH changes - How is the binding of HPRG to heparin dependent on pH? Give structural reasons for the binding dependence.
What is the targets speed just after the bullet emerges : In a ballistics test, a 25 g bullet traveling horizontally at 1200 m/s goes through a 35-cm-thick 350 kg stationary target and emerges with a speed of 1000 m/s. What is the target's speed just after the bullet emerges
Explain what is its solubility under atmospheric conditions : The solubility of CO2 in water at 25°C and 1 atm is 0.034 mol/L. What is its solubility under atmospheric conditions. (The partial pressure of CO2 in air is 0.0003 atm.) Assume that CO2 obeys Henry's law.
What are their speed and direction just after the collision : A 2150 kg truck is traveling east through an intersection at 1.5 m/s when it is hit simultaneously from the side and the rear. What are their speed and direction just after the collision
What is the annual benefit of parents gifting bonds : What is the annual benefit of parents gifting bonds with annual investment income of $300 to their 10-year-old child if the parents are in the 35 percent and the child is in the 15 percent bracket?
Compute how long does it take the grinding wheel to stop : An electric motor rotating a workshop grinding wheel at 1.06 102 rev/min is switched off. How long does it take the grinding wheel to stop
Evaluate the molarity and the molality of an nh3 : Calculate the molarity and the molality of an NH3 solution made up of 36.5 g of NH3 in 70.0 g of water. The density of the solution is 0.982 g/mL.
Evaluate the number of grams of alcohol present : The alcohol content of hard liquor is normally given in terms of the "proof," which is defined as twice the percentage by volume of ethanol (C2H5OH) present. Calculate the number of grams of alcohol present in 1.00 L of 90. proof gin. The density ..
What time interval does this trip around the moon require : An astronaut on the surface of the Moon fires a cannon to launch an experiment package, which leaves the barrel moving horizontally. What time interval does this trip around the Moon require

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the effective annual return

What is the effective annual return (EAR) for an investment that pays 10 percent compounded annually?

  What is the new market value of the company

Again, Inc. is proposing a rights offering. Presently, there are 450,000 shares outstanding at $90 each. There will be 80,000 new shares offered at $84 each.

  Calculate the net cash flow

Company X is planning to estimate the 1st year net cash flow for a proposed project. The financial staff has collected the following information on the project:

  How long do you have to wait to buy your yacht

You have $90000 saved today and want to purchase a new yacht when your money grows to $300000. If you can earn 10 percent on your investments, how long do you have to wait to buy your yacht?

  Computing the stock price

The growth rate for McDonalds is expected to be 10 percent for one year. After that, the dividend rate is expected to grow at a rate of 6 percent indefinitely.

  What must their total liabilities be next year

Suppose next year the Baldwin Company generates $20,000 in net profit, pays $10,000 in dividends, assets change to $151,000, and common stock remains unchanged. What must their total liabilities be next year?

  What are the firm marginal and average tax rates

What are the firm's marginal and average tax rates on taxable income?

  What is the standard deviation of the net income estimate

The forecast for your firm indicates there's a 25% chance that Net Income will be $15,000, a 50% chance it will be $20,000, and a 25% chance it will be $25,000.

  What is the cost of retained earnings

The firm raises funds in increments of $3,000,000 consisting of $900,000 in debt and $2,100,000 in equity. This strategy maintains the capital structure through $12,000,000. What impact would each of the following have on the marginal cost of capi..

  What is mcgonnigal current degree of financial leverage

McGonnigal has outstanding 250,000 shares of $10 (dividend) preferred stock and 1 million shares of common stock ($1 par value). McGonnigal's average tax rate is 35 percent, and its marginal rate is 40 percent.

  Utilize any interest-bearing debt other than the bonds

Debt: 25,000 bonds outstanding, each with a coupon rate of 6.5% paid semi-annually, par value of $1,000, maturity of 20 years, and current value of 96% of par.

  Computation of new price of bonds

Computation of new price of bonds and the market interest rate on these bonds has dropped to 6%

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd