Rick, a Computer Consultant, Owns a Separate Business (Not Real

question 105

Multiple Choice

Rick, a computer consultant, owns a separate business (not real estate) in which he participates. He has one employee who works part-time in the business.

• A) If Rick participates for 500 hours and the employee participates for 620 hours during the year, Rick qualifies as a material participant.
• B) If Rick participates for 550 hours and the employee participates for 2,000 hours during the year, Rick qualifies as a material participant.
• C) If Rick participates for 120 hours and the employee participates for 120 hours during the year, Rick does not qualify as a material participant.
• D) If Rick participates for 95 hours and the employee participates for 5 hours during the year, Rick probably does not qualify as a material participant.
• E) None of the above.

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Definitions:

Line Graph

A type of chart used to display information as a series of data points connected by straight line segments.

Component Bar Graphs

A type of bar graph in which each bar is divided into multiple segments or components, representing different parts of the total for easy comparison and analysis.

Sales Revenues

The total amount of money generated from sales of goods or services before any expenses are subtracted.

Prescription Medicine

drugs that legally require a medical prescription to be dispensed.