Which of the Following Is Not a Necessary Condition for Income

question 81

Multiple Choice

Which of the following is not a necessary condition for income to be included in gross income?

• A) income must be realized.
• B) income must be paid in cash.
• C) income cannot be excluded by law.
• D) income must be made available to a taxpayer on the cash basis.
• E) All of the choices are correct.

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Definitions:

Net Investment

The total spending on new fixed investment minus depreciation on existing physical assets.

Depreciation

The process of allocating the cost of a tangible asset over its useful life, reflecting the decrease in value due to use, wear and tear, or obsolescence.

Disposable Income

The net income available to an individual or household for saving or spending after income taxes have been deducted.

C + I

An abbreviation for "Consumption + Investment," which are components used in calculating gross domestic product (GDP) in the expenditure method.