Net earnings from self-employment

From the records of Tom, a cash basis sole proprietor, the following information was available:

Gross receipts	$30,000
Dividend income (on personal investments)	$ 200
Cost of sales	$15,000
Other operating expenses	$ 3,000
State business taxes paid	$ 300

What amount should Tom report as net earnings from self-employment?

a	$10,900
b	$11,700
c	$12,000
d	$15,000
e	None of the above

3 Which of the following is not an acceptable method of accounting under the tax law?

a	The accrual method
b	The cash method
c	The hybrid method
d	All of the above are acceptable
e	None of the above

4 Becky is a cash basis taxpayer with the following transactions during her calendar tax year:

Cash basis revenue	$54,000
Cash basis expenses, except rent	$25,000
Rent expense (paid on December 1) for use of a building for 18 months	$36,000

What is the amount of Becky’s taxable income from her business for this tax year?

a	$17,000
b	$23,000
c	$25,000
d	$27,000
e	None of the above

5 Jenny constructed a building for use as a residential rental property The cost of the building was $180,000, and it was placed in service on August 1, 1990 The building has a 275-year MACRS life What is the amount of depreciation on the building for 2015 for tax purposes?

a	$2,000
b	$6,000
c	$3,000
d	$6,547
e	None of the above