Question

Kofi Allon, who is 32 years old and single, is employed as a technical consultant for a large electronics distributor. He lives at 678 Birch Street, LaMesa, CA 91941. Kofi's Social Security number is 412-34-5670 (date of birth 5/29/1987).

Kofi’s W-2 contained the following information:

 

Wages (box 1) =	$ 75,350.62
Federal W/H (box 2) =	$ 9,605.43
Social security wages (box 3) =	$ 75,350.62
Social security W/H (box 4) =	$ 4,671.74
Medicare wages (box 5) =	$ 75,350.62
Medicare W/H (box 6) =	$ 1,092.58

 

Kofi's other income includes interest on a money market account at the San Diego Credit Union of $275 and $265 in interest on a Certificate of Deposit at the Bank of California. He also made alimony payments of $650 per month to his ex-wife for ten months for a divorce agreement that was finalized on February 21, 2020. (Marta Tombe, Social Security number 412-34-5673).

 

In addition, he had the following other expenses for 2020:

 

Home mortgage interest	$ 7,670
Auto loan interest	1,325
Credit card interest	730
Property taxes on personal residence	2,342
State income taxes	2,050
Unreimbursed hospital bills	6,300
Doctor bills	2,760
Other qualifying medical expenses	725
Income tax preparation fee	425
Job-hunting expenses	925
Cash donations to his mosque (made ratably over the year and no single contribution was greater than $250)	885

 

In may of 2020, Kofi’s house was broken into and his vintage 1961 Fender Stratocaster guitar was stolen. The guitar had a current fair market value of $15,750, and Kofi had paid $9,000 for the instrument in May of 2008. The guitar was uninsured.

Answer 1

In the books's of YY Ltd
	Consolidated Statement of Comprehensive income as on 31st October, 2020
	Particulars	YY Ltd	ZZ Ltd	Consolidation
	Sale	£           150,000.00	£ 84,000.00	=150000+84000-3500-7000 =223500
Less	Cost of sale	£              60,000.00	£ 27,000.00	=60000+27000-6000 = 81000
	Gross Profit	£              90,000.00	£ 57,000.00	£                                             142,500.00
Less	Operating Exp.	£              25,800.00	£ 18,600.00	=25800+18600 =44400
	Profit befor Tax	£              64,200.00	£ 38,400.00	£                                               98,100.00
Less	Tax	£              12,000.00	£   7,200.00	=12000+7000= 19200
	Profit for Tax	£              52,200.00	£ 31,200.00	£                                               78,900.00

	Particulars	Amt( In Pound)
	Goods sold to ZZ Ltd	£                7,000.00
	Cost of Goods	£                4,000.00
	Profit	£                3,000.00
	Unsold Good's stock in ZZ Ltd	£                7,000.00
	Unrealised profit Eliminated	=3000*85% = 2550
	Unrealised profit Eliminated from NCI	=3000*15% = 450