Tom and RoseMary Own a Cabin near Stowe,Vermont

question 41

Multiple Choice

Tom and RoseMary own a cabin near Stowe,Vermont.During the current year the cabin is rented for 31 days for $1,800.Tom and RoseMary used the cabin a total of 12 days during the year.After making the appropriate allocation of expenses between personal and rental use,the following rental loss was determined:
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How should Tom and RoseMary report the rental income and expenses for the current year?

• A)Include the $1,700 in gross income,but no deductions are allowed.
• B)Report the $300 loss for AGI.
• C)Only expenses up to the amount of $1,700 rental income may be deducted in the current year.
• D)Report the interest ($950)and taxes ($150)as itemized deductions and the other expenses for AGI.
• E)No reporting for the rental activity should be reported.

Grasp how changes in the money supply affect interest rates and aggregate demand.

Comprehend how shifts in aggregate demand influence the economy.

Identify the effects of fiscal policy on aggregate demand.

Analyze the impact of government spending and taxes on the economy.

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