Question
1. Rex was injured in an automobile accident and received $25,000 for his physical injury, $10,000 for his loss of income, and $50,000 for punitive
1. Rex was injured in an automobile accident and received $25,000 for his physical injury, $10,000 for his loss of income, and $50,000 for punitive damages. As a result of the award, the amount Rex must include in gross income is:
a. $10,000
b. $50,000
c. $60,000
d. $85,000
e. None of the above.
2. Lynn's interest and gains on investments for the current year are as follows:
Interest on Madison County school bonds $700
Interest on U.S. government bonds 600
Interest on a Federal income tax refund 200
Gain on the sale of Madison County school bonds 500
Lynn must report gross income in the amount of:
a. $2000
b. $1800
c. $1400
d. $1300
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Advances In Quantitative Analysis Of Finance And Accounting (Vol. 4)
Authors: Lee Cheng Few
2nd Edition
9812700218, 9789812700216
