Hannah Makes the Following Charitable Donations in the Current Year

question 45

Multiple Choice

Hannah makes the following charitable donations in the current year:
$\begin{array}{llr}& \text {Basis}&\text {Fair Market Value}\\ \text { Inventory held for resale in Hannah's business } &\\ \text {(a sole proprietorship) } &\$8,000&\$7,200\\ \text { Stock in HBM, Inc., held as an investment (acquired } &\\ \text {four years ago) } &16,000&40,000\\ \text {Baseball card collection held as an investment } &\\ \text { (acquired six years ago) } &4,000&20,000\\\end{array}$

The HBM stock and the inventory were given to Hannah's church, and the baseball card collection was given to the United Way. Both donees promptly sold the property for the stated fair market value. Disregarding percentage limitations, Hannah's current charitable contribution deduction is:

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Definitions:

Return on Investment

A performance measure used to evaluate the efficiency or profitability of an investment, calculated as the net profit divided by the cost of the investment.

Profit Margin

The ratio of net income to revenue, indicating how much profit is made on average from sales.

Authority

The authority or capability to issue commands, make choices, and ensure compliance.

Decision

The act or process of choosing a particular action among various alternatives based on the expected outcomes.