Charlie Owns Activity B Which Was Considered a Passive Activity

question 83

Multiple Choice

Charlie owns activity B which was considered a passive activity and generated a $17,000 suspended loss.Charlie increases his involvement with activity B so that this year activity B is not considered passive for Charlie.During this year,activity B produces a $9,000 loss.In addition,Charlie acquires an investment in activity X,a passive activity,this year.Charlie's share of activity X's income is $13,000.Charlie's salary this year is $70,000.As a result,this year Charlie must

• A)offset B's loss carryover against X's current income and carry over $9,000 loss from activity B to next year.
• B)offset B's carryover loss and current loss against X's income first and then offset any remaining loss against salary.
• C)offset B's $9,000 loss against X's $13,000 income and offset B's loss carryover against the remaining $4,000 of X's income.
• D)offset B's current $9,000 loss against his salary and offset B's loss carryover against X's income and carry over $4,000 of loss to next year.

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Definitions:

Measure Map

A tool or process used for defining and tracking the key performance indicators (KPIs) or metrics that are critical to the evaluation of success within an organization or process.

Strategy Map

A visual tool that illustrates a company's strategic objectives and the causal relationships between different elements of its strategy.

Balanced Scorecard

A strategic planning and management system used by organizations to align business activities with the vision and strategy of the organization, improve internal and external communications, and monitor organization performance against strategic goals.

BSC Performance Perspectives

Four dimensions used in the Balanced Scorecard framework for strategic management, including financial, customer, internal processes, and learning and growth perspectives.