Section 162 (a) of the Internal Return Code allows only that deductions be made if the activity incurred an expense was due to trade or business status of that activity. Therefore, your gambling activities are not trade thus their winnings can not be offset against your travelling and lodging expenses you incurred while gambling. Therefore, Mr. Green as a taxpayer, you are not allowed to deduct your gambling expenses against your gambling winnings. The case of Trent v. Commissioner, 291 F.2d 669 (2d Cir.1961) shows that it is only losses from business activities that can be deducted from the business profits and all the activities that involved the success of that main business will be offset against the business revenue. In conclusion, Mr. Greens gambling are not of trade or business status thus he can not use his gambling gains to pay off the traveling and lodging expenses he incurred while coming to
Inventory turnover 56,534,254 / 8,517,203 = 6.6 * Profitability ratios 5. Asset turnover $56,534,254 / 34,825,498 = 1.6 times 6. Profit margin $2,430,872 / 56,534,254 = 4.3 7. Return on assets $2,430,872 / 34,825,498 = 6.9 8. Return on common stockholders’ equity $29,946,992 - (2430872-15801332) / 200,000 = 82.9% * Solvency ratios 9.
Debt to assets ratio $1,202,134 (total debt) / $1,404,726 (total assets) = 87.4% B.) ROA is a measure of profitability or effectiveness of resource usage calculated by expressing a company’s net income as a percentage of total assets. As for Sepracor, its ROA is 4.5%. This means that Sepracor created 4.5 cents of earnings from each dollar of assets. The ROE for Sepracor is 33.07%, which means that 33.07 cents of assets are created for each dollar that was originally invested.
[3] http://www.irs.gov/businesses/small/article/0,,id=146335,00.html It is important to determine if the taxpayer martially participates because this classifies the income as active or passive. Passive activity losses are non-deductable from active and portfolio income. This is why it is important to determine if the taxpayer martially participates in the business activity. PROBLEMS: 7-46) The $30,000 loss is considered a passive loss and can only be deducted against passive income, it is therefore suspended and carried forward to future years to offset potential passive income in those years. Mary has no martially participation in the rental activity, therefore the loss is considered
reliability of measurements. : 4 5 of 5 Question 9. Question : (TCO 5) A voluntary change in accounting principle is accounted for by: a cumulative effect on income in the year of the change. a retrospective reporting of all comparative financial statements shown. a prior period adjustment.
Since Profit Margin are calculated using EBIT, Income Tax plays a great role to affecting the results. Step Seven….figures are in $000’s TOTAL | 2012 | 2011 | 2010 | 2009 | Current Asset | 55,838 | 64,438 | 53,315 | 70,140 | Non-Current Asset | 69,936 | 75,013 | 75,879 | 71,528 | Asset | 119,774 | 139,451 | 129,194 | 141,668
Table of Contents Executive Summary 2 Competitiveness analysis 2 Zeus’s performance measure system 2 Zeus’s fund performance 3 Performance measure selection 3 Assumptions 3 Zeus Equity Fund 3 Table 1.1: Zeus Equity Fund VS S&P 500 Index 4 Table 1.2: Zeus Equity Fund VS Lipper Growth Index 4 Zeus Bond Fund 5 Table 2.1: Zeus Bond Fund VS Lehman Brothers Aggregate Index 5 Zeus Balance Fund 5 Table 3.1: Zeus Balance Fund VS Lipper Balanced Index 5 Zeus International Fund 6 Table 4.1: Zeus International Fund VS MSCI Index 6 Executive Summary This report is aim to evaluate and analyse Zeus funds’ performance on a risk-adjusted basis. A competitiveness analysis has been given based on Zeus’s operation advantages. It also explained the advantages of using risk-adjusted measures and showed different characteristics carried with each measure. Performance measure has been offered and compared with adjusted benchmark proxies. Finally, recommendations on alternative measures have been discussed.
Net working capital | Year 1 | Year 2 | Year 3 | Year 4 | | Inventory | 1,5 | 1,5 | 1,5 | | All in millions | receivables | 16,5 | 12,45 | 8,25 | | | payables | 1,6 | 1,6 | 1 | | | NWC(=Inventory+receivables-payables) | 16,4 | 12,35 | 8,75 | | | Change in NWC | 16,4 | -4,05 | -3,6 | -8,75 | | Q6. FCF = (Revenue – Costs – Depreciation) x (1 – tax rate) + Depreciation – Capital Expenditure – change in working capital. Free cash flows | Year 0 | Year 1 | Year 2 | Year 3 | Year 4 | | Unl Net income | -59,3439 | 70,1337 | 49,3248 | 30,828 | 0 | All in millions | Depreciation | 0 | 8 | 8 | 8 | 0 | | Capital expenditures | 24 | 0 | 0 | 0 | 0 | | Change in NWC | 0 | 16,4 | -4,05 | -3,6 | -8,75 | | Free cash flows | -83,34 | 61,73 | 61,37 | 42,43 | 8,75 | | Q7. | | Year 1 | Year 2 | Year 3 | Year 4 | | NPV per year | -83,34 | 55,12 | 48,93 | 30,20 | 5,56 | All in millions | Total NPV | 56,46 | | | | | | Q8. Rate | NPV(million) | 5% | 74,97 | 10% | 61,35 | 15% | 49,65 | 20% | 39,5 | 25% | 30,63 | 30% | 22,84 | 35% | 15,94 | 40% | 9,81 | 45% | 4,32 | 50% | -0,61 | 55% | -2,89 | 60% | -5,06
Chapter 6 8. 1. The parameters of the opportunity set are: E(rS) = 15%, E(rB) = 9%, sS = 32%, sB = 23%, r = 0.15, rf = 5.5% From the standard deviations and the correlation coefficient we generate the covariance matrix [note that Cov(rS, rB) = rsSsB]: Bonds Stocks Bonds 529.0 110.4 Stocks 110.4 1024.0 The minimum-variance portfolio proportions are: wMin(B) = 0.6858 The mean and standard deviation of the minimum variance portfolio are: E(rMin) = (0.3142 × 15%) + (0.6858 × 9%) = 10.89% = [(0.31422 × 1024) + (0.68582 × 529) + (2 × 0.3142 × 0.6858 × 110.4)]1/2 = 19.94% % in stocks % in bonds Exp. return Std dev. 00.00 100.00 9.00 23.00 20.00 80.00 10.20 20.37 31.42 68.58 10.89 19.94 Minimum variance
Dividends and dividend equivalent rights declared | | | 0 | | | | 0 | | | | (10,676 | ) | | | 0 | | | | (10,676 | ) | Repurchase of common stock | | | (46,976 | ) | | | 0 | | | | (22,950 | ) | | | 0 | | | | (22,950 | ) | Share-based compensation | | | 0 | | | | 2,253 | | | | 0 | | | | 0 | | | | 2,253 | | Common stock issued under stock plans, net of shares withheld for employee taxes | | | 6,981 | | | | (143 | ) | | | (444 | ) | | | 0 | | | | (587 | ) | Tax benefit from equity awards, including transfer pricing adjustments | | | 0 | | | | 1,232 | | | | 0 | | | | 0 | | | | 1,232 | | | | | | | | | | | | | | | | | | | | | | | Balances as of September 28, 2013 | | | 899,213 | | | $ | 19,764 | | | $ | 104,256 | | | $ | (471 | ) | | $ | 123,549 | | | | | | | | | | | | | | | | | | | | | |