Q: Is EXPERIAN a good source for living expenses?
A: Experian is a good source of information about personal debt obligations - such as credit card and revolving debt and mortgage debt - but it does not collect information about living expense. Only the guarantor can provide that information. The personal income tax returns provide some personal expense information, such as alimony payments if they exist or medical and dental expenses, but the vast majority of personal living expenses are not captured anywhere for any purposes. In effect, only the guarantor knows.
Q: How would you account for $100k in credit card availability but zero balances?
A: If the balance has remained zero for some period of time, then zero is appropriate. However, if the account balance has fluctuated over the past year, applying an average or high balance would be a more appropriate amount to allocate.
Q: A condo would typically have home owners association dues. These can be material numbers depending on the condo project.
A: [Larry Crevin has a rental property at Northstar.] If it is part of a condo complex with homeowner fees and assessment, then it may be subject to homeowner dues. Homeowner dues and assessment can be material and Crevin reports no amount for such expenses. But it's unclear exactly where the property is located at Northstar and whether it is subject to such fees and assessments. If Crevin had to pay such fees, it stands to reason that he would claim them on Schedule E Part I since that would reduce his overall income tax obligation. Since he doesn't report such fees, I would assume his property is not subject to them. An item that can be clarified in a conversation with Larry Crevin.
Q: How is the $90k in living expenses derived?
A: The amount is an estimate from Larry Crevin. Keep in mind that living expenses are always the most questionable amount in any personal cash flow statement.
Q: Where did the $80k in taxes portion come from?
A: In estimating Cash taxes, we used information from these three locations-
Q: In the breakdown of 1040 Line 17 Sch. E Income/Sub S, you mention income of $319,870. I'm only seeing the distribution of $252,616?
A: In addition to $252,616 of distributions found on the Schedule K-1 (Form 1120S), we took the change in loans to owner of $67,254 found on the financial statement for Total Coverage, Inc. Together, the two amounts represent a cash outflow of $319,870.
A: Experian is a good source of information about personal debt obligations - such as credit card and revolving debt and mortgage debt - but it does not collect information about living expense. Only the guarantor can provide that information. The personal income tax returns provide some personal expense information, such as alimony payments if they exist or medical and dental expenses, but the vast majority of personal living expenses are not captured anywhere for any purposes. In effect, only the guarantor knows.
Q: How would you account for $100k in credit card availability but zero balances?
A: If the balance has remained zero for some period of time, then zero is appropriate. However, if the account balance has fluctuated over the past year, applying an average or high balance would be a more appropriate amount to allocate.
Q: A condo would typically have home owners association dues. These can be material numbers depending on the condo project.
A: [Larry Crevin has a rental property at Northstar.] If it is part of a condo complex with homeowner fees and assessment, then it may be subject to homeowner dues. Homeowner dues and assessment can be material and Crevin reports no amount for such expenses. But it's unclear exactly where the property is located at Northstar and whether it is subject to such fees and assessments. If Crevin had to pay such fees, it stands to reason that he would claim them on Schedule E Part I since that would reduce his overall income tax obligation. Since he doesn't report such fees, I would assume his property is not subject to them. An item that can be clarified in a conversation with Larry Crevin.
Q: How is the $90k in living expenses derived?
A: The amount is an estimate from Larry Crevin. Keep in mind that living expenses are always the most questionable amount in any personal cash flow statement.
Q: Where did the $80k in taxes portion come from?
A: In estimating Cash taxes, we used information from these three locations-
- Form 1040 – Lines 64 and 65
- Schedule A - LInes 5, 6 and 7
- Statement 3 – FICA, Medicare, and City/SDI
Q: In the breakdown of 1040 Line 17 Sch. E Income/Sub S, you mention income of $319,870. I'm only seeing the distribution of $252,616?
A: In addition to $252,616 of distributions found on the Schedule K-1 (Form 1120S), we took the change in loans to owner of $67,254 found on the financial statement for Total Coverage, Inc. Together, the two amounts represent a cash outflow of $319,870.