Amity Is an Employee with a Period Gross Pay of $2,000.She

question 35

Multiple Choice

Amity is an employee with a period gross pay of $2,000.She elects to have 3% of her gross pay withheld for her 401(k) contribution.What will be her taxable income be for federal income taxes?

• A)$2,000
• B)$1,970
• C)$1,940
• D)$1,910

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Definitions:

Sole Proprietor

An individual who owns and operates a business by themselves, bearing full responsibility for its debts and legal actions.

Limited Liability

A legal structure where a person's financial responsibility for a company's debts and obligations is restricted to a fixed amount, typically their investment.

Sole Proprietorship

A business owned and operated by a single individual, where there is no legal distinction between the owner and the business.

Undisclosed Principal

A person who is represented in a transaction by an agent but whose identity is not revealed to the third party involved.