White Corporation, a Personal Service Corporation, Had $75,000 of Active

question 2

Multiple Choice

White Corporation, a personal service corporation, had $75,000 of active income, $15,000 of portfolio income, and a $90,000 passive loss during the year.How much of the passive loss is deductible?

• A)$0.
• B)$15,000.
• C)$75,000.
• D)$90,000.
• E)None of the above.

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Definitions:

Bank Errors

Mistakes made by a bank in recording transactions in an account holder's records.

Outstanding Checks

Outstanding checks are checks that have been written and recorded in the account holder's register but have not yet been cleared or cashed by the bank.

Adequate Cash Flow

Sufficient amounts of cash on hand that an entity has to meet its financial obligations and operational needs.

Bills

Documents indicating a transaction or an obligation to pay for goods or services received.