Suppose at the Beginning of 2018, Jamaal's Basis in His

question 33

Multiple Choice

Suppose at the beginning of 2018, Jamaal's basis in his S corporation stock is $1,000, and he has a $10,000 debt basis associated with a $10,000 loan he made to the S corporation. In 2018, Jamaal's share of S corporation income is $4,000, and he received a $7,000 distribution from the S corporation. How much income does Jamaal report in 2018 from these transactions?

• A) $0.
• B) $4,000.
• C) $6,000.
• D) $7,000.
• E) None of the choices are correct.

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Definitions:

Cognitive Psychologist

A professional who studies mental processes such as perception, memory, thinking, problem-solving, and decision-making.

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Done automatically without conscious thought as a spontaneous reaction or response.

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A phrase indicating the act of someone beginning to speak or articulate thoughts, often used metaphorically.

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The fleshy part of the face below the eye and between the nose and the ear, important for expression and speech.