Gabby Owns and Operates a Part-Time Art Gallery,now in Its

question 89

Multiple Choice

Gabby owns and operates a part-time art gallery,now in its fifth year.She views it as a business activity,but she is concerned that the IRS will challenge her classification and consider it a hobby.Her business results,using the cash method of accounting,were net losses in the first and fourth years and small profits in the second and third years.It is now almost year-end and based on projections,the business is showing a small profit of $6,000.Repairs to the security system and to the heating/cooling system were recently completed and these bills total $7,000.When should Gabby pay these bills?

• A)before year-end to get the current year deduction
• B)next year
• C)split into $6,000 this year and $1,000 next year
• D)It does not matter when she pays the bills.The work was performed this year,so the costs will be deducted this year.

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Definitions:

Ecosystem

An ecological community comprising both living organisms and their physical surroundings that interact with each other.

Physical Environment

refers to all the physical and abiotic factors that surround and affect the survival and development of organisms, such as water, air, temperature, and geography.

Ecosystem

A community of living organisms in conjunction with the non-living components of their environment, interacting as a system.

Community

A group of interacting living organisms sharing a populated environment, often considered within the context of ecological and biological studies.