Salvatore, an investor-broker, earns $195,000 from his practice in the current year. he receives $35,000 in dividends and interest during the year. in addition, he incurs a loss of $18,000 from an investment in a passive activity acquired three years ago. after considering the passive investment, salvatore's net income for the current year is $

Earnings from practice                          195,000

Dividend and interest received            35,000

Loss incurred on investment                (18,000)

Net income after passive investment  212,000

Explanation:

In this case, we need to aggregate Salvatore's earnings from practice and dividend received from investment and deduct loss incurred on passive investment.

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