Funky Chicken Is a Calendar Year S Corporation with the Following

question 24

Multiple Choice

Funky Chicken is a calendar year S corporation with the following current year information:
Operating loss $\quad$$\quad$$\quad$$\quad$$\quad$ $ (300,000 )
Liabilities:
Note payable, Big Bank $\quad$$\quad$$\quad$ 30,000
Note payable, June Cross $\quad$$\quad$ 20,000
On January 1 June Cross bought 60% of Funky Chicken for $45,000. She then loaned the company $20,000. How much of the operating loss may Cross deduct on her Form 1040? Assume the excess business loss limitation does not apply.

• A) $57,000
• B) $80,000
• C) $65,000
• D) $75,000

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Definitions:

Referent Power

A form of influence based on identification with, adoration of, or respect for the leader or authority figure.

Centrality

The importance or influence of a node within a network, or of an individual within a social or organizational structure.

Substitutability

The extent to which one good or service can be replaced with another, indicating the ease with which products can serve as substitutes for each other.

Revenue Source

The origin or means through which an organization generates income, such as sales, subscriptions, or advertising.