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Alex, who is single, conducts an activity in 2019 that is appropriately classified as a hobby. The activity produces the following revenues and expenses: Revenue $18,000 Property taxes 3,000 Materials and supplies 4,500 Utilities 2,000 Advertising 5,000 Insurance 750 Depreciation 4,000 Without regard to this activity, Alex's AGI is $42,000. Determine the amount of Alex's taxable income assuming he has not other itemized deductions. The standard deduction for single taxpayers is $12,000. Taxable income: $_________

Respuesta :

Answer:

Taxable income is $48,000

Explanation:

The computation of the taxable income is shown below:

= Alex AGI + Revenue - standard deduction

= $42,000 + $18,000  - $12,000

= $48,000

We simply added the Adjusted Gross income (AGI) and revenue and then deducted the standard deduction which is given in the question.

The other information which is given in the question is not relevant for the computation part. Hence, ignored it

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