Katarina owns a condominium in the Hilton Head Island, South Carolina. During the year, Katarina uses the condo a total of 40 days. The condo is also rented to vacationers for a total of 160 days and generates rental income of $17,500. Katarina incurs the following expenses:

Expense	Amount
Mortgage interest	$ 6,000
Property taxes	5,400
Utilities	2,000
Insurance	1,000
Depreciation	10,500

Using the IRS method of allocating expenses, the amount of depreciation that Katarina may take with respect to the rental property will be

A) $ 1,050.

B) $ 6,780

C) $ 8,500.

D) $10,500.

. In 2016, Juan earned $10,000 in net investment income and incurred $15,000 of investment interest expense. Juan paid off the loan in early 2017, so he only paid $3,000 of investment interest expense in 2017. He earned $12,000 of net investment income in 2017. How much investment interest expense can Juan deduct in 2017?

A) $0

B) $3,000

C) $5,000

D) $8,000

Nasim paid the following taxes this year:

Real estate taxes on rental property she owns	$5,000
Real estate taxes on her own residence	4,400
Federal income taxes	10,000
State income taxes	6,750

For 2018, what amount can Nasim deduct as an itemized deduction on her tax return?

A) $8,150

B) $10,000

C) $18,150

D) $23,150

GarLee Grocery, Inc., a C corporation with high taxable income, donates some of its inventory to the Local Food Bank (a charitable organization) which distributes food to the needy. At the time of the contribution, the FMV of the inventory was $20,000, and GarLee Grocery's basis was $6,000. Lee Grocery will be allowed a charitable contribution deduction of

A) $8,000.

B) $12,000.

C) $13,000.

D) $20,000.