What could explain Freda willingness to spread her salary

Assignment Help Accounting Basics
Reference no: EM132655400

Problem - Freda is a cash basis taxpayer. In 2019, she negotiated her salary for 2020. Her employer offered to pay her $21,000 per month in 2020 for a total of $252,000. Freda countered that she would accept $10,000 each month for the 12 months in 2020 and the remaining $132,000 in January 2021. The employer accepted Freda's terms for 2020 and 2021.

Required -

a. Did Freda actually or constructively receive $252,000 in 2020?

b. What could explain Freda's willingness to spread her salary over a longer period of time?

c. In December 2020, after Freda had earned the right to collect the $132,000 in 2020, the employer offered $133,000 to Freda at that time, rather than $132,000 in January 2021. The employer wanted to make the early payment so as to deduct the expense in 2020. Freda rejected the employer's offer. Was Freda in constructive receipt of the income in 2020? Explain.

Reference no: EM132655400

Questions Cloud

What investors learn from interpreting the results of ratio : Select a company that trades common stock on the NYSE. Identify and describe the information that is included in the stock trading reports for that stock
Why the consumption function is upward sloping : (a) There are FOUR main components of GDP. Explain the components.
Determine the tax consequences of the events : Determine the tax consequences of the following events to the corporation and to Troy: On December 31, 2019, Troy was visiting a customer
What is the foreign trade policy instruments : What is the foreign trade policy instruments (international trade agreements ,and how its impact on firm's economic activities?
What could explain Freda willingness to spread her salary : What could explain Freda's willingness to spread her salary over a longer period of time? Did Freda actually or constructively receive $252,000 in 2020
Discuss the various functions involved in transaction cycle : Discuss in detail the various functions involved in "Transaction Cycle" with suitable examples. Discuss methods of setting premium rates in insurance
Government actions on the current and future us gdp : Discuss the impact of the following three government actions on the current and future U.S. GDP:
Visa vs Master Card : Analysis of the two businesses and a discussion of the payments industry, including but not limited to, strengths of these businesses,
Identify two insurance companies in kingdom of saudi arabia : Identify any two insurance companies in Kingdom of Saudi Arabia and explain any two insurance products offered by them. Type of Insurance

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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