Bart, a Single Taxpayer, Has Recently Retired

question 57

Multiple Choice

Bart, a single taxpayer, has recently retired. This year, he received $24,000 in pension payments and $5,000 of social security payments. What amount must Bart include in his gross income for the social security payments?

• A) $4,250
• B) $1,500
• C) $2,500
• D) Zero
• E) $750

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Definitions:

Par Value

The nominal or face value of a share of stock or a bond as specified by the issuing company.

Net Income

The ultimate earnings a company reports after all deductions, including taxes and expenses, from total income.

Average Common Stockholders' Equity

The average equity held by common shareholders, calculated typically over a year, representing the company's assets minus its liabilities attributable to common shareholders.

Prior Period Adjustment

Adjustments made to the financial statements of a prior period to correct errors or implement changes in accounting policy.