Renee operates a proprietorship selling collectibles over the Web. This year, Renee's business reported revenue of $95.5 million and deducted $88.6 million in expenses and loss carryovers. Her business deductions included cost of goods sold of $48.5 million, sales commissions paid of $16.9 million, $10.5 million of interest paid on a mortgage, $10.7 million of depreciation, and $2 million deduction for a net operating loss carryover. c. Suppose that Renee's revenue includes $5 million of business interest income. What is the maximum amount of business interest expense that could be deducted this year under the business interest limitation? Note: Do not round intermediate calculations. Enter your answer in millions of dollars rounded to 2 decimal places. Deductible Business Interest Expense million
Renee operates a proprietorship selling collectibles over the Web. This year, Renee's business reported revenue of $95.5 million and deducted $88.6 million in expenses and loss carryovers. Her business deductions included cost of goods sold of $48.5 million, sales commissions paid of $16.9 million, $10.5 million of interest paid on a mortgage, $10.7 million of depreciation, and $2 million deduction for a net operating loss carryover. c. Suppose that Renee's revenue includes $5 million of business interest income. What is the maximum amount of business interest expense that could be deducted this year under the business interest limitation? Note: Do not round intermediate calculations. Enter your answer in millions of dollars rounded to 2 decimal places. Deductible Business Interest Expense million
Chapter3: Business Income And Expenses
Section: Chapter Questions
Problem 22MCQ
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Question
![Renee operates a proprietorship selling collectibles over the Web. This year, Renee's business reported
revenue of $95.5 million and deducted $88.6 million in expenses and loss carryovers. Her business
deductions included cost of goods sold of $48.5 million, sales commissions paid of $16.9 million, $10.5
million of interest paid on a mortgage, $10.7 million of depreciation, and $2 million deduction for a net
operating loss carryover.
c. Suppose that Renee's revenue includes $5 million of business interest income. What is the maximum amount of business
interest expense that could be deducted this year under the business interest limitation?
Note: Do not round intermediate calculations. Enter your answer in millions of dollars rounded to 2 decimal places.
Deductible Business Interest Expense
million](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe4a3c8c7-ae5e-45ee-9797-13d83d29f3dc%2Fa2bda004-7e5a-4f39-a74e-4951a607cc33%2Fyzjf0vs_processed.png&w=3840&q=75)
Transcribed Image Text:Renee operates a proprietorship selling collectibles over the Web. This year, Renee's business reported
revenue of $95.5 million and deducted $88.6 million in expenses and loss carryovers. Her business
deductions included cost of goods sold of $48.5 million, sales commissions paid of $16.9 million, $10.5
million of interest paid on a mortgage, $10.7 million of depreciation, and $2 million deduction for a net
operating loss carryover.
c. Suppose that Renee's revenue includes $5 million of business interest income. What is the maximum amount of business
interest expense that could be deducted this year under the business interest limitation?
Note: Do not round intermediate calculations. Enter your answer in millions of dollars rounded to 2 decimal places.
Deductible Business Interest Expense
million
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