Tommy, a Senior at State College, Receives Free Room and Board

question 95

Multiple Choice

Tommy, a senior at State College, receives free room and board as full compensation for working as a resident advisor at the university dormitory. The regular housing contract is $2,000 a year in total, $1,200 for lodging and $800 for meals in the dormitory. Tommy had the option of receiving the meals or $800 in cash. Tommy accepted the meals. What must Tommy include in gross income from working as a resident advisor?

• A) All items can be excluded from gross income as a scholarship.
• B) The meals must be included in gross income.
• C) The meals may be excluded because he did not receive cash.
• D) The lodging must be included in gross income because it was compensation for services.
• E) None of these.

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Definitions:

Degree of Relationship

A measure of kinship calculated by the number of steps from one family member to another through common ancestors.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the individual values in a data set differ from the mean.

Positively Correlated

A statistical relationship where two variables move in the same direction; as one increases, the other tends to increase as well.

Midterm

A type of examination or assessment typically given halfway through an academic term to measure students' understanding and knowledge in a specific course.