McGwHa Education Connect mheducatic Domain Manager StudentLangovOn Campus & Ors

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McGwHa Education Connect mheducatic Domain Manager StudentLangovOn Campus & Ors D Devry Uniestyl HW Problems Help Seve& Exit Su Check my wo Required information Problem 9-55 (LO 9-3) The following information applies to the questions displayed below) Renee manufactured and sold a "gadget a specialized asset used by auto manufacturers that qualifies for the includes $3,200 of wages Renee paid to employees in the manufacturing of the gadget domestic production activities deduction. Renee incurred $16,000 in direct expenses in the project, which What is Renee's domestic production activities deduction for the gadget in each of the following alternative scenarios? es Problem 9-55 Part-a a. Renee sold the gedget for $31.200 and she reported AGI of $92.000 before considering the manufecturing deduction

Explanation / Answer

15200* 9%

$ 1368

renee's modified AGI of $92000 exceeds qualified production activity income and $ 1368 deduction is less than 50% of wages paid in the activity ( 50 % of $3200 = $ 1600)

qualified domestic gross receipts $ 31200 less : allocable cost and expenses (16000) qualified production activity income 15200 statutary percentage 9% Domestic production activity deduction

15200* 9%

$ 1368

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