Question

Jamari Peters (Social Security number 123-45-6789) conducts a business with the following results in 2019: Revenue $20,000 Depreciation on car 3,960 Operating expenses of car 3,100 Rent 6,000 Wages 8,200 Amortization of intangibles 680 Jamari estimates that due to a depressed real estate market, the value of land owned by the business declined by $5,200.Calculate the effect of Jamari’s business on his AGI.

Answer 1

AGI will be reduced by $1,940

Step-by-step explanation:

given data

Revenue = $20,000

Depreciation on car = 3,960

Operating expenses of car = 3,100

Rent = 6,000

Wages = 8,200

Amortization of intangibles = 680

solution

we know here Total Expenses are

Total Expenses = Depreciation on car + Operating expenses of car + Rent + Wages + Amortization of intangibles .........................1

put here value

Total Expenses = 3,960 + 3,100 + 6,000 + 8,200 + 680

Total Expenses = 21940

so

Net Income is = Revenue - Total Expenses

Net Income is = $21940 - $20,000

Net Income is = - $1940

so AGI will be reduced by $1,940