Maria, who owns a 50% interest in a restaurant, has been a material participant in the restaurant activity for the last 20 years. She retired from the restaurant at the end of last year and will not participate in the restaurant activity in the future. However, she continues to be a material participant in a retail store in which she is a 50% partner. The restaurant operations produce a loss for the current year, and Maria's share of the loss is $80,000. Her share of the income from the retail store is $150,000. She does not own interests in any other activities. (Points : 5)

a. Maria cannot deduct the $80,000 loss from the restaurant because she is not a material participant.

b. Maria can offset the $80,000 loss against the $150,000 of income from the retail store.

c. Maria will not be able to deduct any losses from the restaurant until she has been retired for at least three years.

d. Assuming that Maria continues to hold the interest in the restaurant, she will always treat the losses as active.

e. None of the above

On december 31, 2011, daggett company issued $750,000 of ten-year, 9% bonds payable for $700,353, yielding an effective interest rate of 10%. interest is payable semiannually on june 30 and december 31. prepare journal entries to reflect (a) the issuance of the bonds, (b) the semiannual interest payment and discount amortization (effective interest method) on june 30, 2012, and (c) the semiannual interest payment and discount amortization on december 31, 2012. round amounts to the nearest dollar.

An employer who is considering hiring eva has asked donna, eva’s former supervisor, for a report on eva. in truth, eva’s work for donna has been only average. however, eva is donna’s friend, and donna knows that eva probably will not get the job if she says anything negative about eva, and donna knows that eva desperately needs the job. further, donna knows that if the situation were reversed, she would not want eva to mention her deficiencies. nevertheless, it has been donna’s policy to reveal the deficiencies of employees when she has been asked for references by employers, and she knows that some of eva’s faults may be bothersome to this particular employer. finally, this employer has leveled with donna in the past when donna has asked for a report on people who have worked for him. should donna reveal deficiencies in eva’s past performance? (remember to use one of the three moral theories acceptable for this test to solve this dilemma. any discussion of any personal opinion, religious perspective, or theory other than the moral theories acceptable for this test will result in a score of "0" for this question.)

6carla would like to buy a dress, a dresser for her bedroom, and a home theater system. she has one month's worth of living expenses in her emergency fund. carla decides to save for the home theater system. did carla make the right decision? why or why not? a. yes; her emergency fund is full and the other items will probably be less expensive. b. yes; she could save more for her emergency fund, but the home theater will be harder to save for. c. no; she should save more for her emergency fund because she has saved less than the recommended amount. d. no; she should have bought the dress and dresser first because she could afford them right away. reset next