Vic's At-Risk Amount in a Passive Activity Is $200,000 at the Beginning

question 44

Multiple Choice

Vic's at-risk amount in a passive activity is $200,000 at the beginning of the current year. His current loss from the activity is $80,000. Vic had no passive activity income during the year. At the end of the current year:

• A) Vic has an at-risk amount in the activity of $120,000 and a suspended passive activity loss of $80,000.
• B) Vic has an at-risk amount in the activity of $200,000 and a suspended passive activity loss of $80,000.
• C) Vic has an at-risk amount in the activity of $120,000 and no suspended passive activity loss.
• D) Vic has an at-risk amount in the activity of $200,000 and no suspended passive activity loss.
• E) None of the above.

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Definitions:

Paid-in Capital

The amount of capital "paid in" by investors during common or preferred stock issuances, including the par value of the shares and amounts over par.

Stock Dividend

A stock dividend is a dividend payment made to shareholders in the form of additional shares of stock instead of cash.

Stock Dividend

Instead of cash, a company distributes additional shares to its shareholders as a form of payment.

Total Stockholders' Equity

The total net value owned by the shareholders of a company, calculated as the difference between total assets and total liabilities.