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FromTheMoon [43]
3 years ago
13

Sarah has investments in four passive activity partnerships purchased several years ago. Last year the income and losses were as

follows: Activity Income (Loss) A $30,000 B (30,000) C (15,000) D (5,000) In the current year, she sold her interest in Activity D for a $10,000 gain. Activity D, which had been profitable until last year, had a current loss of $1,500. Answer the following questions to determine how the sale of Activity D affects Sarah's taxable income in the current year. a. The amount of suspended losses carried forward to the year of the sale is $ . b. What amount of the suspended losses is allocated to Activity D? $ c. How much, if any, of this net gain may be used to absorb passive activity losses from other activities? $
Business
1 answer:
iogann1982 [59]3 years ago
6 0

Answer:

Explanation:

In last year, Sarah couldn't deduct anything against non passive income and need to allocate the $20,000 net loss between the three loss activities.

Activity                      Income (Loss)

A                                 30,000

B                                 (30,000)

C                                  (15,000)

D                                   (5,000)

Net Passive Loss         (20,000)

Allocation of net passive loss to Activity B,C and D.

Activity B (30/50 * $20,000)    ($12,000)

Activity C (15/50 * $20,000)         ($6,000)

Activity D (5/50 * $20,000)          ($2,000)

Suspended losses Total        ($20,000)

In current year, Sarah has a net gain of $10,000 from sale of Activity D. Sarah can set off $2,000 suspended loss from the activity and the current year’s loss of $1,500 from activity across $10,000 gain. Further, the balancing net gain of $6,500 (10,000-2,000 -1,500) from the sale may be utilized to cover passive losses from the other activities.

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Answer: False

Explanation:

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8 0
2 years ago
Corporate social responsibility: Group of answer choices
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Answer:

Letter e is correct.<em> Extends beyond ethics to include community, environment, and human rights</em>

Explanation:

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In a globalized world, there is legal pressure from consumers, institutions, NGOs and the media to make companies not only profitable but also voluntary contributors to building a more egalitarian society.

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5 0
3 years ago
In the year 2020, a divorced woman under age 50 collects $50,000 of alimony and child support as her sole source of income. The
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The available options are:

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C. A tax deductible contribution of up to $7,000 is permitted

D. A tax deductible contribution of up to $9,000 is permitted

Answer:

No contribution can be made because the woman does not have earned income

Explanation:

Unlike in the previous years before 2019, concerning divorce agreements, alimony is now declared to be no longer deductible by the payor and at the same time is considered to be a tax-free income to the recipient. In essence, this indicates that alimony is no longer qualifies as earned income and therefore, cannot be utilized to fund an Individual Retirement Account.

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8 0
3 years ago
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Answer:

The correct answer is option B.

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As a result the industry supply will increase in the long run. The increase in supply would cause the price to fall. This would further contribute in reducing revenue and profit.

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Answer:

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Hence, the material cost per unit is $4.60 per unit

The same should be considered and relevant

5 0
3 years ago
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