Robert and Melissa own a home in Big Bear Lake,California.During the year,they rented it for 55 days for $11,000 and used it for 12 days for personal use.The expenses for the house included $12,000 in mortgage interest,$2,000 in property taxes,$1,000 in utilities,$600 in maintenance,and $4,000 in depreciation.What is their income or loss from their cabin without considering the passive loss limitation) ? Use the IRS method for allocation of expenses.Round your answer to the nearest whole number.)
A) $5,090 net loss.
B) $11,000 net income.
C) $2,947 net loss.
D) $0.
Correct Answer:
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