Becky, a Single Individual, Reports the Following Taxable Items in 2016

question 47

Essay

Becky, a single individual, reports the following taxable items in 2016:
$\begin{array}{llr} \text { Gross income from business } &\$93,000\\ \text { Mintus: Business expenses } & \underline{(105,000)}\\&(\$12,000)\\ \text { Interest income } & \underline{1,500}\\ \text { A G I } &(\$10,500)\end{array}$
Itemized deductions:
$\begin{array}{ll}\text { Interest expense } & \$ 3,100 \\\text { State Income Taxes } & 1,900 \\\text { Casualty } & \underline{3,000} \\ \text {Total itemized deductions } &&(8,000)\\ \text { Minus: Personal exemption } && \underline{(4,050)}\\ \text { Taxable income} && \underline{(\$22,550)}\end{array}$
What is Becky's NOL for the year?

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Definitions:

Compounded Monthly

Refers to the process by which the interest earned on an investment is calculated on a monthly basis, with each month's interest being added to the principal for the calculation of subsequent interest.

Compounded Annually

Compounded annually refers to the process where interest is added to the principal sum of a deposit or loan once per year, and future interest is earned on the interest from previous periods as well as the principal.

Time Value

The assertion that money held today is more valuable than equivalent amounts in the future because of its potential for earning.