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Exercise - Pharoah Profiles provides testing services to school districts that wish to assess students' reading and mathematical abilities. Last year Pharoah evaluated 68,500 math tests and 22,833 reading tests. An income statement for last year follows.
Math Testing
Reading Testing
Total Company
Total
Per Unit
Sales revenue
$1,370,000
$20
$867,654
$38
$2,237,654
Variable expenses
890,500
13
388,161
17
1,278,661
Contribution margin
$479,500
$7
$479,493
$21
958,993
Fixed expenses
360,000
Operating income
$598,993
What is Pharoah's breakeven point in sales dollars?
Married taxpayers Otto and Ruth are both self-employed and file a joint return. Otto earns $432,600 of self-employment income and Ruth has a self-employment.
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In addition, during the year they drove 109 miles for medical transportation, and their insurance company reimbursed them $900 for the above expenses. Calculate the Murphy's medical expense deduction.
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