1)Belinda purchases a computer system costing $6,000. During the current year, 70% of the use of the computer is for keeping the books and records of her Plasticware business, 20% of the use is for tracking her investments, and 10% of the use is personal. Explain the treatment of the computer according to the income tax concepts.

2)Fran Holloway is an active dealer in used automobiles. While preparing her income tax return, you notice that she purchased one automobile for $7,000 and sold it one month later for $5,800 to Brian Holloway Enterprises. Explain, in terms of the income tax concepts, why the $1,200 loss on the sale of the automobile may not be deductible.

3)Robin owns an appliance store. Robin gives Tim a stereo unit to paint the front of her store building. The stereo unit, included in Robin's inventory at a cost of $400, normally retails for $700. If Tim had billed Robin for his work like he charged other customers, he would have sent Robin a bill for $600. Does Tim have income from the receipt of the stereo unit? If so, what amount should Tim report as gross income? Explain in terms of the Income Tax Concepts.

4)Describe payroll taxes for employees and employers.