Jermaine and Kesha Are Married, File a Joint Tax Return

question 50

Multiple Choice

Jermaine and Kesha are married, file a joint tax return, have AGI of $82,500, and have two children. Devona is beginning her freshman year at State University during Fall 2017, and Arethia is beginning her senior year at Northeast University during Fall 2017 after having completed her junior year during the spring of that year. Both Devona and Arethia are claimed as dependents on their parents' tax return. ​
Devona's qualifying tuition expenses and fees total $4,000 for the fall semester, while Arethia's qualifying tuition expenses and fees total $6,200 for each semester during 2017. Full payment is made for the tuition and related expenses for both children during each semester. The American Opportunity credit available to Jermaine and Kesha for 2017 is:

• A)$2,500.
• B)$3,000.
• C)$5,000.
• D)$6,000.
• E)None of the above.

---

Definitions:

Standard Hours Allowed

The amount of time that should be taken to complete a specific amount of work, according to predefined standards.

Labour Rate Variance

The difference between the actual cost of labor and the expected (or standard) cost, based on the standard rate per hour.

Standard Cost Per Mip

Standard cost per MIP refers to the benchmark or predetermined cost assigned to manufacturing one unit of measurement or milepost in production, used for budgeting and performance evaluation.

Direct Labour

Compensation for employees who are directly involved in manufacturing products or providing services.