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Tomtit [17]
3 years ago
8

Stephen and Joy own a duplex in Newport Beach, CA. They live in one unit and rent the other to another couple. Their rental inco

me for the year was $24,000. They incurred the following expenses for the entire duplex: What amount of net income from the duplex should Stephen and Joy report for the current year? Insurance Maintenance Utilities Depreciation $ 8,000 $ 800 $ 1,800 $ 4,000
Business
1 answer:
sertanlavr [38]3 years ago
7 0

Answer:

$16,700

Explanation:

The computation of net income is shown below:-

Total expense = Insurance + Maintenance + Utilities + Depreciation

= $8,000 + $800 + $1,800 + $4,000

= $14,600

Expense of rented unit = Total expense ÷ Units

= $14,600 ÷ 2

= $7,300

Here, we assume 2 units

Net income for reporting = Rental income - Expense of rented unit

= $24,000 - $7,300

= $16,700

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