Several Years Ago,Joy Acquired a Passive Activity

question 39

Multiple Choice

Several years ago,Joy acquired a passive activity.Until 2009,the activity was profitable.Joy's at-risk amount at the beginning of 2009 was $250,000.The activity produced losses of $100,000 in 2009,$80,000 in 2010,and $90,000 in 2011.During the same period,no passive income was recognized.How much is suspended under the at-risk rules and the passive loss rules at the beginning of 2012? At-risk Passive loss

• A) $0 $270,000.
• B) $20,000 $250,000.
• C) $30,000 $240,000.
• D) $260,000 $10,000.
• E) None of the above.

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Definitions:

Erosion Resistance

The ability of material or landform to withstand wear and transport by natural forces such as wind or water.

Fractures

Breaks in rocks along which there has been no significant movement parallel to the surfaces of the fracture.

Drainage Pattern

The arrangement of channels in an area, shaped by the landscape's topography and underlying geology.

Erosion Resistance

The ability of a material, especially rock or soil, to withstand the wear and tear caused by natural forces such as water, wind, and ice.