Alex, who is single, conducts an activity in the current year that is appropriately classified as a hobby. The activity produces the following revenues and expenses: Revenue Property taxes Materials and supplies Utilities Advertising Insurance Depreciation $18,000 3,000 4,500 2,000 5,000 750 4,000 Without regard to this activity, Alex's AGI is $62,000. Determine the amount of income Alex must report and the amount of the expenses he is permitted to deduct