Charles Is a Single Person,age 35,with No Dependents

question 61

Multiple Choice

Charles is a single person,age 35,with no dependents.In 2014,Charles has gross income of $75,000 from his sole proprietorship.Charles also incurs $80,000 of deductible business expenses in connection with his proprietorship.He has interest and dividend income of $22,000.Charles has no itemized deductions.Charles's taxable income is

• A)$6,850.
• B)$10,800.
• C)$13,050.
• D)$17,000.

---

Definitions:

Plantwide Predetermined Overhead Rate

A single overhead rate calculated by dividing total estimated overhead costs by an estimated allocation base for the entire plant.

Direct Labor-hours

The sum of hours spent by staff actively involved in the process of manufacturing.

Activity Measure

A metric or index used to gauge the extent or level of activity undertaken in a particular process or operation.

Activity-based Costing

A method of allocating overhead and indirect costs to products or services based on the activities that generate those costs.