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Problem \#1 - Calculating Federal Income Tax \& Refund/Payment Due John is a single taxpayer and has the following information for 2021 : Kequirea: 1. What is John's taxable income? 2. What is John's federal income taxes? 3. Does John owe money or get a refund? How much? 4. What is John's marginal tax rate? 5. What is John's average tax rate? Problem \#2 - S Corporation vs C Corporation Andrew and Jake decide to start a new business. - Andrew will own 70% and Jake will own 30%. - They are both single taxpayers. Andrew is in the 24% marginal tax bracket and Jake is in the 32% tax bracket. - In Year 1, the business makes a profit of $100,000. - Andrew withdraws $35,000 and Jake withdraws $15,000. Required: 1. If they select to be a C-Corporation, how much will the corporation pay in federal income taxes? How much will they each pay in federal income taxes? 2. If they select to be a S-Corporation, how much will the corporation pay in federal income taxes? How much will they each pay in federal income taxes? Problem \#3 - Depreciation In 2021, ABC Inc. purchased equipment classified as 5 Year property. The cost of the equipment is $50,000 and the salvage value is $5,000. Required: 1. Using MACRS, what is the depreciation expense for 2021 ? 2. Using MACRS, what is the depreciation expense for 2022 ? Problem \#4 - Depreciation In October of 2021, Johnson Inc. purchased a warehouse for $3,500,000. The cost includes $500,000 for the land and the salvage value for the warehouse is $300,000. Required: 1. Using MACRS, what is the depreciation expense for 2021 ? 2. Using MACRS, what is the depreciation expense for 2022 ? Problem \#1 - Calculating Federal Income Tax \& Refund/Payment Due John is a single taxpayer and has the following information for 2021 : Kequirea: 1. What is John's taxable income? 2. What is John's federal income taxes? 3. Does John owe money or get a refund? How much? 4. What is John's marginal tax rate? 5. What is John's average tax rate? Problem \#2 - S Corporation vs C Corporation Andrew and Jake decide to start a new business. - Andrew will own 70% and Jake will own 30%. - They are both single taxpayers. Andrew is in the 24% marginal tax bracket and Jake is in the 32% tax bracket. - In Year 1, the business makes a profit of $100,000. - Andrew withdraws $35,000 and Jake withdraws $15,000. Required: 1. If they select to be a C-Corporation, how much will the corporation pay in federal income taxes? How much will they each pay in federal income taxes? 2. If they select to be a S-Corporation, how much will the corporation pay in federal income taxes? How much will they each pay in federal income taxes? Problem \#3 - Depreciation In 2021, ABC Inc. purchased equipment classified as 5 Year property. The cost of the equipment is $50,000 and the salvage value is $5,000. Required: 1. Using MACRS, what is the depreciation expense for 2021 ? 2. Using MACRS, what is the depreciation expense for 2022 ? Problem \#4 - Depreciation In October of 2021, Johnson Inc. purchased a warehouse for $3,500,000. The cost includes $500,000 for the land and the salvage value for the warehouse is $300,000. Required: 1. Using MACRS, what is the depreciation expense for 2021 ? 2. Using MACRS, what is the depreciation expense for 2022

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