Sam Runs a Proprietorship That Generated $75,000 in Profits in 20x0

question 6

Multiple Choice

Sam runs a proprietorship that generated $75,000 in profits in 20x0. Included in these profits are: a) $10,000 - amortization expense; b) $5,000 - reasonable bad debt expense; c) $55,000 - cost of goods sold (closing inventory at market value) ; and $8,000 - meals and entertainment with clients. Sam's capital cost allowance has been accurately calculated at $8,500 for the year. How much is Sam's business net income for tax purposes?

• A) $73,500
• B) $75,000
• C)$80,500
• D) $89,000

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Definitions:

Positive Reinforcement

A technique in behavior management that increases the likelihood of a behavior by associating it with positive outcomes or rewards.

Expert Power

The influence a person holds over others due to their skills or knowledge in a specific domain.

Psychological Power

The influence or control over others' beliefs, emotions, or behaviors through persuasive, charismatic, or leadership abilities, rather than through coercion or force.

Referent Power

A form of power that arises from being admired, respected, or identified with, often leading to influence due to personal traits rather than formal authority.