Mary and Philip Purchased an Apartment Building in January 2004,which

question 103

Multiple Choice

Mary and Philip purchased an apartment building in January 2004,which they actively manage.During the current year,the apartment building generates a loss of $35,000.Their other income is as follows:
$\begin{array}{lr}\text { Salaries } & \$ 80,000 \\\text { Dividends and interest } & 8,000 \\\text { Loss from limited partnership acquired in } 1999 & (4,000) \end{array}$
What is Mary and Philip's adjusted gross income?

• A)$59,000
• B)$63,000
• C)$84,000
• D)$88,000
• E)None of the above.

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Definitions:

Excess Reserves

The capital reserves held by a bank or financial institution in excess of what is required by regulators, central bank, or other governing body.

Actual Reserves

The amount of funds that a bank has on hand and available to lend, beyond its reserve requirements.

Required Reserves

The minimum amount of funds a bank must hold in reserve against deposit liabilities, as mandated by regulatory authorities.

Required Reserve Ratio

The fraction of deposits that banks are required to keep on hand and not loan out, used by central banks to control the amount of money in circulation.