Which of the Following Is Not a General Rule for Allocating

question 26

Multiple Choice

Which of the following is not a general rule for allocating nonbusiness income?

• A) Interest and dividends to the state of commercial domicile.
• B) Rental income for investment property to state of commercial domicile.
• C) Capital gains from rental property to state where property is located.
• D) Rental income for business property to state where property is located.

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Definitions:

Unrealized Loss

A decrease in the value of an investment that has not yet been sold and thus, the loss has not been realized.

Gain on Sale of Investment

The profit realized from selling an investment for more than its purchase cost.

Fair Value

The estimated market value of an asset or liability based on current prices in an open and competitive market.

Equity Securities

Financial instruments that represent ownership in a company, such as stocks, entitling holders to dividends and capital gains.