Mike and Pam Own a Cabin near Teluride,Colorado How Should Mike and Pam Report the Rental Income and Year

question 151

Multiple Choice

Mike and Pam own a cabin near Teluride,Colorado.In the current year the cabin was rented for 8 days to friends.Mike and Pam used the cabin a total of 82 days during the same year.After allocating the expenses between personal and rental use,the following rental loss was determined:
$\begin{array}{ll}\text { Rental income } & \$ 700 \\\text { Property taxes } & (250) \\\text { Mortgage interest } & (300) \\\text { Repairs and maintenance } & (100) \\\text { Utilities } & (150) \\\text { Rental loss } & \$(100) \end{array}$
How should Mike and Pam report the rental income and expenses for last year?

• A)Report the $100 loss for AGI.
• B)Include the $700 in gross income, but no deductions are allowed.
• C)Only expenses up to the amount of $700 rental income may be deducted.
• D)Report the interest ($300) and taxes ($250) as itemized deductions and the other expenses for AGI.
• E)No reporting for the rental activity is necessary.

Differentiate between substantive and relationship goals in negotiations.

Understand the principles and importance of integrative negotiation.

Recognize common pitfalls in negotiation and strategies to avoid them.

Understand the effects of negotiation outcomes on ongoing relationships.

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