Jake and Alicia are influencers on Instagram. They dated for several years and subsequently broke up. As retaliation, Jake shared disparaging, reckless, and defamatory posts on his Instagram which damaged Alicia's reputation and resulted in a loss of her followers, her collaboration with brands, and ultimately a significant loss of her income. Alicia sued Jake for emotional distress due to the damage to her reputation. Alicia estimated that her lost income due to decline in engagement is $350,000, her reputation prior to the damage was worth $1,000,000 and the expected income from her brand collaborations before it was cancelled was $700,000. Jake settled out of court for $2,000,000. How much is Alicia required to include in income? A) $1,050,000 OB) $0 C) 950,000 OD) $2,000,000
Jake and Alicia are influencers on Instagram. They dated for several years and subsequently broke up. As retaliation, Jake shared disparaging, reckless, and defamatory posts on his Instagram which damaged Alicia's reputation and resulted in a loss of her followers, her collaboration with brands, and ultimately a significant loss of her income. Alicia sued Jake for emotional distress due to the damage to her reputation. Alicia estimated that her lost income due to decline in engagement is $350,000, her reputation prior to the damage was worth $1,000,000 and the expected income from her brand collaborations before it was cancelled was $700,000. Jake settled out of court for $2,000,000. How much is Alicia required to include in income? A) $1,050,000 OB) $0 C) 950,000 OD) $2,000,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Gadubhai
Transcribed Image Text:Jake and Alicia are influencers on Instagram. They dated for several years and
subsequently broke up. As retaliation, Jake shared disparaging, reckless, and
defamatory posts on his Instagram which damaged Alicia's reputation and resulted in
a loss of her followers, her collaboration with brands, and ultimately a significant loss
of her income. Alicia sued Jake for emotional distress due to the damage to her
reputation. Alicia estimated that her lost income due to decline in engagement is
$350,000, her reputation prior to the damage was worth $1,000,000 and the
expected income from her brand collaborations before it was cancelled was
$700,000. Jake settled out of court for $2,000,000. How much is Alicia required to
include in income?
A) $1,050,000
OB) $0
C) 950,000
OD) $2,000,000
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