Mark and Stacy Are Married,file a Joint Return,and Have One

question 19

Multiple Choice

Mark and Stacy are married,file a joint return,and have one child,age 3.Their combined AGI is $55,000.Mark and Stacy incur $3,500 of child care expenses during the current year.Mark's employer reimburses him $1,500 under a qualified dependent care assistance plan.The child and dependent care credit is

• A)$300.
• B)$600.
• C)$700.
• D)$1,200.

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Definitions:

Accounting Equation

The fundamental equation of accounting stating that Assets = Liabilities + Shareholder's Equity, underpinning the double-entry bookkeeping system.

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary accounts' balances to permanent ones, thereby resetting the temporary accounts for the next period.

Permanent Accounts

The balance sheet accounts whose balances are carried over into future accounting periods, not closed at the end of the fiscal year.

Posting

The process of recording financial transactions to the appropriate accounts in the general ledger.