During the Current Year, Diane Disposes of Fine Foods Limited

question 110

Multiple Choice

During the current year, Diane disposes of Fine Foods Limited Partnership, at a gain of $12,000. Diane's adjusted gross income from non-passive sources is $120,000. She has a suspended loss from Fine Foods of $22,000, and a loss from other passive activities of $4,500. What is the amount of Diane's adjusted gross income for the current year?

• A)$95,550
• B)$105,500
• C)$110,000
• D)$115,500
• E)$120,000

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Definitions:

Retained Earnings Statement

A financial statement that outlines the changes in retained earnings for a company over a specific period.

Owners' Equity

The residual interest in the assets of an entity after deducting liabilities, representing the ownership interest of the shareholders.

Net Income

The total earnings of a company after subtracting all expenses and losses from total revenue.

Return on Equity

A financial ratio that measures the profitability of a business in relation to the equity held by the shareholders.