Tomas Owns a Sole Proprietorship, and Lucy Is the Sole

question 53

True/False

Tomas owns a sole proprietorship, and Lucy is the sole shareholder of a C corporation. In the current year, both businesses make a net profit of $60,000. Neither business distributes any funds to the owners in the year. For the current year, Tomas must report $60,000 of income on his individual tax return, but Lucy is not required to report any income from the corporation on her individual tax return.

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Definitions:

Naive Forecast

A forecasting technique that assumes future values will be the same as past values, often used as a baseline for more complex models.

Time-series Data

Data points collected or recorded at successive points in time, often used to analyze trends, cycles, or patterns.

Seasonal Variation

Periodic fluctuations in data or phenomena that occur at regular intervals within a year due to seasonal factors.

Cycles

Periods or sequences in a system or process that repeat in a regular pattern, such as the phases of economic growth and decline or the operation of machinery.