Joy Reports the Following Income and Loss Activities A, B, and C Are All Passive Activities

question 98

Multiple Choice

Joy reports the following income and loss: $$\begin{array} { | l | r | } \hline \text { Salary } & \$ 120,000 \\\hline \text { Income from activity A } & 60,000 \\\hline \text { Loss from activity B } & ( 35,000 ) \\\hline \text { Loss from activity C } & ( 55,000 ) \\\hline\end{array}$$ Activities A, B, and C are all passive activities.
Based on this information, Joy has

• A) adjusted gross income of $90,000.
• B) salary of $120,000 and deductible net losses of $30,000.
• C) salary of $120,000 and net passive losses of $30,000 that will be carried over.
• D) salary of $120,000, passive income of $60,000, and passive loss carryovers of $90,000.

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Definitions:

Deregulation

The process of cutting down or abolishing state control in a certain field, often pursued to encourage a higher level of competitive activity within that field.

Presidents

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Corporate Concentration

Describes a market condition characterized by the dominance of a small number of large firms, leading to reduced competition and potentially higher prices for consumers.

War

A state of armed conflict between different countries or different groups within a country.