LaMont works for a company in downtown Chicago. The firm encourages employees to use public transportation (to save the environment) by providing them with transit passes at a cost of $270 per month.

a. If LaMont receives one pass (worth $270) each month, how much of this benefit must he include in his gross income each year?

b. If the company provides each employee with $270 per month in parking benefits, how much of the parking benefit must LaMont include in his gross income each year?

a) $180

b) $180

Explanation:

Employee Fringe Benefits is a form of payment by an employer other than money. The limit for employee fringe benefit is often decided by the IRS every year. The statutory limit for the year 2016 was $255, 2019 was $265 and the new statutory limit for the year 2020 is $270.

In the question provided, since the particular year was not stated, we will assume that the year is 2016 of which the limit for employee fringe benefit was $255.

a. The cost of transit pass qualifies as employee fringe benefit. Based on 2016 statutory limits, LaMont excludes $255.

Therefore his amount of transit pass benefit to be included in gross income

= ($270 - $255)×12

= $180

b. The cost of parking benefits qualifies as employee fringe benefit. Based on 2016 statutory limits, LaMont excludes $255.

Therefore his amount of parking benefit to be included in gross income

= ($270 - $255)×12

= $180

income statement is prepared in order to show the profits and loss of a business. in order to prepare the income statement she should collect all the income and expenses of the product with the cost of production.

i'ts proportional. if the inflation rate is 12% for example, the cpi will be 12% less.

hope it ,

bioteacher101