Tracy invested in the following stocks and bonds during 2019. $\begin{array}{lr}
\text { Blue, Inc. } & \$ 25,000 \
\text { City of Falcon bonds } & 75,000
\end{array}$ To finance the investments, she borrowed $100,000 from Swan Bank. Interest expense paid on the loan during 2019 was $5,000. During 2019, Tracy received $1,250 of dividend income from Blue, Inc. and $3,000 of interest income on the municipal bonds.
a. Determine the amount of Tracy's gross income.

b. Determine the maximum amount of Tracy's deductible interest expense.

Question

Tracy invested in the following stocks and bonds during 2019. $\begin{array}{lr}
\text { Blue, Inc. } & \$ 25,000 \
\text { City of Falcon bonds } & 75,000
\end{array}$ To finance the investments, she borrowed $100,000 from Swan Bank. Interest expense paid on the loan during 2019 was $5,000. During 2019, Tracy received $1,250 of dividend income from Blue, Inc. and $3,000 of interest income on the municipal bonds. 
a. Determine the amount of Tracy's gross income.

b. Determine the maximum amount of Tracy's deductible interest expense.

Quizplus · Accepted Answer

The Answer of Tracy invested in the following stocks and bonds during 2019. $\begin{array}{lr}
\text { Blue, Inc. } & \$ 25,000 \
\text { City of Falcon bonds } & 75,000
\end{array}$ To finance the investments, she borrowed $100,000 from Swan Bank. Interest expense paid on the loan during 2019 was $5,000. During 2019, Tracy received $1,250 of dividend income from Blue, Inc. and $3,000 of interest income on the municipal bonds. 
a. Determine the amount of Tracy's gross income.

b. Determine the maximum amount of Tracy's deductible interest expense.

Tracy Invested in the Following Stocks and Bonds During 2019 Blue, Inc. $25,000 City of Falcon bonds 75,000\begin{array}{lr}\text { Blue, Inc. } & \$ 25,000 \\\text { City of Falcon bonds } & 75,000\end{array} Blue, Inc. City of Falcon bonds ​$25,00075,000​

Tracy Invested in the Following Stocks and Bonds During 2019 $\begin{array}{lr}\text { Blue, Inc. } & \$ 25,000 \\\text { City of Falcon bonds } & 75,000\end{array}$