Brady Owns a Second Home That He Rents to Others

question 68

Multiple Choice

Brady owns a second home that he rents to others. During the year, he used the second home for 50 days for personal use and for 100 days for rental use. Brady collected $20,000 of rental receipts during the year. Brady allocated $7,000 of interest expense and property taxes, $10,000 of other expenses, and $4,000 of depreciation expense to the rental use. What is Brady's net income from the property and what type and amount of expenses will he carry forward to next year, if any?

• A)$0 net income. $1,000 depreciation expense carried forward to next year.
• B)($1,000)net loss. $0 expenses carried over to next year.
• C)$0 net income. $1,000 of other expense carried over to next year.
• D)$0 net income. $1,000 of interest expense and property taxes carried over to next year.

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Definitions:

Childhood Influences

The impact of experiences, environments, and relationships during early years of life on one's development and personality.

Horney

Refers to Karen Horney, a psychoanalytic psychologist known for her theory of neurosis, which places a significant emphasis on cultural and social factors.

Womb Envy

A psychoanalytic concept suggesting that men experience feelings of envy toward the biological capacities of women, such as childbirth, which they cannot experience.

Horney

Karen Horney, a psychoanalytic theorist known for her theory of neurotic needs and her work on neurotic personality development.