Sam pursued a hobby of making bedspreads in her spare time in 2018. Her AGI before considering the hobby is $40,000. During the year she sold the bedspreads for $14,000. She incurred expenses as follows: Supplies $5,000 Interest on loan to get business started Advertising 7,500 Assuming that the activity is deemed a hobby, how should she report these items on her tax return? PLEASE SHOW ALL CALCULATIONS 500 A. Include $14,000 in income and deduct $12,200 from AGI. B. Ignore both income and expenses since hobby losses are disallowed. C Include $14,000 in income, deduct nothing from AGI D. Include S14,000 in income and deduct interest of $500 for AGL E None of the above