Wayne Owns a Small Apartment Building That Produces a $45,000

question 85

True/False

Wayne owns a small apartment building that produces a $45,000 loss during the year.His AGI before considering the rental loss is $85,000.Because Wayne is an active participant with respect to the rental activity, he may deduct the
$45,000 loss.

---

Definitions:

Support Department Costs

Expenses related to departments that do not directly contribute to the production of goods or services but provide necessary support, such as IT and HR.

Support Activity Costs

Expenses related to functions that assist the core operations of a business, such as human resources or accounting, which do not directly contribute to the production of goods or services.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to related products and services based on the activities they require.

Direct Method

A cash flow statement preparation method that lists specific classes of gross cash receipts and payments.