Colin and Megan Own a Cabin in the Mammoth Mountains,California

question 61

Multiple Choice

Colin and Megan own a cabin in the Mammoth Mountains,California.During the year,they rented it for 45 days for $10,000 and used it 12 days for personal use.The expenses for the cabin included $7,000 in mortgage interest,$3,000 in property taxes,$1,200 in utilities,$400 in maintenance,and $3,000 in depreciation.What is their net income or loss from the cabin (without considering the passive loss limitation) ? Use the IRS method for allocation of expenses.(Round your answer to the nearest whole number)

• A)$0.
• B)$1,526 net loss.
• C)$7,632 net loss.
• D)$10,000 net income.

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