Subjective Short Answer-10 Points Each 21. ZYX Corporation, a closely held yea r
ID: 2394568 • Letter: S
Question
Subjective Short Answer-10 Points Each 21. ZYX Corporation, a closely held yea r. The co activity. Wh poration also receives $35, at is ZYx's income for the year after considering the passiv non-personal service) C corporation, earns active income of $300,000 in the current 000 in dividends and incurs a loss of $50,000 from an investment in a passive e investment? 22. ABC Corporation is an eligible small business for purposes of the disabled access credit. During the year, ABC makes the following expenditures on a structure originally placed in service in 1988. Removal of architectural barriers Acquired equipment for disabled persons $ 8,500 6.25 In addition, $8,000 was expended by ABC on a building originally placed in service in the current year to ensure easy accessibility by disabled individuals. Calculate the amount of the disabled access credit available to ABC Corporation $14,750Explanation / Answer
21 Active Income 300000 Add: Dividends 35000 Less: Loss from investment 50000 Income after considering income/loss from passive investment 285000 22 The eligible expenditure under this section is limited to expense on sturctures placed in service after November 5, 1990 hence expenditure done on structure place in service in 1988 is not eligible for credit. Amount spent on building placed in service this year 8000 Credit is 50% of amount spent or $5000 whichever is higher 4000 Amount of disabled access credit available is $4000