In the Fall of 2018, James Went Back to School

question 846

Multiple Choice

In the fall of 2018, James went back to school to earn a master of accountancy degree. He incurred $7,000 of qualified educational expenses and his modified AGI for the year was $40,000. His Lifetime Learning Credit is

• A) $1,000.
• B) $1,800.
• C) $1,400.
• D) $2,500.

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Definitions:

Contribution Format

A profit reporting format that separates fixed and variable costs, highlighting the contribution margin.

Total Contribution Margin

The total earnings available after variable costs have been deducted from revenue, used to cover fixed costs and contribute to profit.

Units

In the context of production and inventory, units refer to the individual items or products counted for operational, accounting, or sales purposes.

Sales Commissions

Payments made to sales personnel based on the value or volume of sales they have made, usually a percentage of the sale price.