Question

The following information for "2019" pertains to Bartley Corporation: Capital contributions by shareholders $50,000 Realized loss on sale of treasury stock (10,500) Income from rental property in a sinking fund (in the hands of a trustee) 5,500 Rent paid directly to a bond holder on a lease of corporate property 8,000 What is the amount of gross income to Bartley Corporation for 2019?

Answer 1

$13,500

Step-by-step explanation:

Bartley's gross income should include only two items:

1. income from rent paid directly to a bond holder
2. income from rental property in a sinking fund

2019 gross income = $8,000 + $5,500 = $13,500

The net gains or losses associated to the selling or rebuying of stocks are considered capital gains or losses, and they are taxed differently than gross income.