Randall Invested $200,000 in Activity a and $100,000 in Activity

question 32

Multiple Choice

Randall invested $200,000 in Activity A and $100,000 in Activity B (both passive) in 2003.At the beginning of 2017,Randall's at-risk amount was $20,000 in A and $15,000 in B.Activity A had a loss of $25,000 and Activity B had income of $30,000.What is the amount of income or loss recognized in 2017 from these activities?

• A)$0.
• B)$5,000 income.
• C)$10,000 income.
• D)$25,000 loss.

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Definitions:

Minimum-Contacts Standard

A legal standard that determines whether it is fair for a court in one jurisdiction to assert its authority over a defendant from another jurisdiction.

Business Firm

An organization engaged in commercial, industrial, or professional activities with the purpose of generating profit.

Large Corporations

Substantial business entities with significant operational scale, usually involving multi-national operations and a large number of employees.

Jurisdiction

The legal authority granted to a court or governmental entity to make decisions and enforce laws.