Question & Answer: 2, Mary is 48 years old and in good health. She has two dependent children. Her husband died suddenly in 2016. She has gross income of $34,000, no…..

2, Mary is 48 years old and in good health. She has two dependent children. Her husband died suddenly in 2016. She has gross income of $34,000, no deductions for adjusted gross income, and does not itemize deductions. Mary’s taxable income for 2016 is:

a. $21,400

b. $21,850

c. $12,550

d. $34,000

e. $9,250

3, Eugenia and Victor are married. For 2016, Eugenia earned $35,000 and Victor earned $30,000. They have decided to file separate returns and are each entitled to claim one personal exemption. They have no deductions for adjusted gross income. Eugenia’s itemized deductions are $7,400 and Victor’s are $5,400. Assuming Eugenia and Victor do not live in a community property state, what is Eugenia’s taxable income?

a.$23,550

b.$24,650

c.$27,600

d.$35,000

e.None of these choices are correct

4, Alan bought shares in Coca-Cola for $10,000 on November 15, 2015. On November 1, 2016, he sold the shares for $5,000. He has no other gains or losses in 2016. What does Alan report on his tax return?

a.$5,000 short-term loss

b.$5,000 long-term loss

c.$3,000 ordinary loss and $2,000 short-term carry-forward

d.$3,000 ordinary loss and $2,000 long-term carry-forward

5, On January 1, 1996, Donna bought a single family house to use as a rental. She paid $300,000 for the property and has claimed depreciation of $60,000 over the intervening years. She sells the house on January 1, 2016, for $400,000 incurring selling expense of $24,000. What is Donna’s gain or loss?

a.$160,000 gain

b.$100,000 gain

c.$136,000 gain

d.$16,000 loss