Reference no: EM132119418
Question - On January 1,2016 Peggy (age 27 & single) opened her own tax consulting firm. In the current year she had the following income & expenses
Collected cash consulting fees 1,500,000
Had outstanding AR at 12/31/16 of 130,000
Had outstanding AR at 12/31/17 of 100,000
Paid salarys 850,000
Paid medical insurance for staff of 22,000
Paid medical insurance for herself 8,000
She bought a Jaguar & intended to deduct it as a business expenses (90% business) 250,000
Operating costs 49,000
Business parking 4,200
Toll vioations 1,000
Purchased reception furniture in October 2017 420,000
Purchased computers in February 2017 35,000
Interest income 12,000
Interest income - CA Muni 2,000
Peggy made CA estimate payments of 12,000
Investment management fees 4,000
Required -
A. What was her net business income?
B. What was her AGI?
C. What was her taxable income?