M, Age 65 and Single, Has No Dependents and an A.G.I

question 41

Multiple Choice

M, age 65 and single, has no dependents and an A.G.I, of $50,000 and these expenses: medical expenses of $2,200, personal casualty losses of $5,000, real estate taxes of $2,000, and residence mortgage interest of $1,000.In 2012 the taxpayer should deduct which of the following total amounts from A.G.I.?

• A)$10,200
• B)$14,000
• C)$11,200
• D)Some other amount

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Definitions:

Secondary Market

A financial market where previously issued financial instruments such as stock, bonds, options, and futures are bought and sold.

Interest

The cost of borrowing money, often expressed as a percentage rate over a period of time, or the income earned from lending money.

Dividends

Money disbursed by a business to its members, principally originating from the enterprise's earnings.

Financial Intermediary

An institution that pools investors’ money and invests it on their behalf giving the investors shares of itself. Mutual funds are the primary example.