When the Term F

question 54

Multiple Choice

When the term F.O.B. shipping point is used, title passes:

• A) when goods reach the halfway point.
• B) when goods reach the destination.
• C) when goods are shipped.
• D) when the buyer signs for the product.

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Definitions:

Passive Activities

Economic activities in which the individual does not materially participate, often resulting in income or losses for tax purposes.

Passive Income

Income resulting from rental property, limited partnerships, or other enterprises in which a person is not actively involved.

Personal/Rental Property

Property owned by an individual that may be used for personal enjoyment or rented out to generate income.

Flow-Through Entities

Business entities that pass income directly to owners or investors, avoiding corporate income tax.