Question

Case Study 4 F garden retailer in 20 full-time and the plants and egrown Gardens, LLP, is a $10 million nurse on retailer in Florida. Homegrown employs about 11-time and seasonal employees. The majority of plants and nursery stock that Homegrown sells es from Monromio Nurseries, a wholesaler based Alabama. Monromio is recognized throughout the South for the quality of the plants it grows and sells. Homegrown is generally happy to pay the premium prices that Monromio's plants command, because it passes the extra costs on to its customers, who value the high-quality plants it sells. However, Barry Greenstem, one of Homegrown's managing partners, is visibly upset after speaking with the owners of other nurseries at a recent trade show in Atlanta. Although Monromio has increased its prices across the board, Monromio's price hike to Homegrown is larger than the average. Barry suspects that Betty Stevenson, Homegrown's assistant manager in charge of purchasing nursery stock, may be accepting kickbacks from Monromio in return for allowing higher purchase prices. Betty and her husband, Mike, purchased a new SUV, a houseboat, and several ATVs last year and moved into a new, larger house this year. Barry knows that Betty's salary isn't high enough to support the new lifestyle, and he doubts that Mike's job

I need help.Thanks.

Answer 1

For calculating the income from unknown sources we have to follow the below steps:

1. We have to subtract the liabilities from the assets of the respective years to calculate the net worth.
2. Subtracting the net worth of last year from the current year's net worth will determine the increase in net worth.
3. Adding the expenses for the current year to the increase in net worth will give us the total current income.
4. Deducting the income from known sources will give us the answer for income from unknown sources.

This Last year Year Rou Solution - Asseto Personal residence. Automobiles. Houseboat ATV's 70,000 15,000 70,000 45,000 30,000 12,000 200,000 45,000 30,000 12,000 DOS Total Assets. (A) 0 85,000 6 1,57,000 2,87,000 Liabilities Mortgage balance. Auto Loan Loan on houseboat 30,500 400,000 35,000 2,500 15,000 11,000 Total liabilities () 37,500 45,500 1,11,000 | Net Worth & (A-B) 47,500. Less: Priot year Net worth Net Worth Increase (6) 1, 11,500 47,500 64,000 176,000 1,11,500 64,500

00 Last year. Net Worth Imereane (8) 64,000 This year. 64,500 Add: Expenses 13,000 II Mortgage payments. 4.500. Auto payments. 1,800. Housebout payments. 2,400. Other living expenses. 17,000 - Total expenses (E). 25,700 Current Income. (O+E) 89,700. 1,800 2,400 15,000 32,200 961700

This feat 96,700 Last year Current Income. 89,700 Lesso Income from known Sources Betty's Salary 25,600 Mike's Salary. 36.000 61,500 Income from Unknown Sources. 28,200 ng 26,000 37,000 63,000 33,700

This Last year Year Rou Solution - Asseto Personal residence. Automobiles. Houseboat ATV's 70,000 15,000 70,000 45,000 30,000 12,000 200,000 45,000 30,000 12,000 DOS Total Assets. (A) 0 85,000 6 1,57,000 2,87,000 Liabilities Mortgage balance. Auto Loan Loan on houseboat 30,500 400,000 35,000 2,500 15,000 11,000 Total liabilities () 37,500 45,500 1,11,000 | Net Worth & (A-B) 47,500. Less: Priot year Net worth Net Worth Increase (6) 1, 11,500 47,500 64,000 176,000 1,11,500 64,500

00 Last year. Net Worth Imereane (8) 64,000 This year. 64,500 Add: Expenses 13,000 II Mortgage payments. 4.500. Auto payments. 1,800. Housebout payments. 2,400. Other living expenses. 17,000 - Total expenses (E). 25,700 Current Income. (O+E) 89,700. 1,800 2,400 15,000 32,200 961700

This feat 96,700 Last year Current Income. 89,700 Lesso Income from known Sources Betty's Salary 25,600 Mike's Salary. 36.000 61,500 Income from Unknown Sources. 28,200 ng 26,000 37,000 63,000 33,700