[Shay]

Becker SIM–R2–SIM 2.1

what is the net income? I got $0. when entering EXPENSES answer in the field, do I put has a NEGATIVE NUMBER?

[IfThereIsaGod]

Yes NI is 0 and the extra 1,000 rolls over into next year because schedule C can't be less than 0. Correct me if I am wrong anyone.

AUD----92 5/31/12
FAR----92 7/3/12
RED----85 8/3/12
BEC----?? 8/29/12

[Shay]

@IfThereIsaGod

You are right about the answer and about the carryover.

My 2nd question, was did you enter

expenses as NEGATIVE number? otherwise you wouldn't get a $0 as Net Income right..

[IfThereIsaGod]

Here is a good answer I found online because I was wondering the same thing:

“With most of your ordinary business expenses, if you have more expenses than you have income, your business can show a net operating loss that may be deductible against any other regular income you have (such as interest, dividends, or income from another job or business). This may even be true if the loss is a “paper loss” resulting from depreciation. However, it is not true of the home office deduction.

Your home office deduction is limited by the amount of your net business income. If your net income is too low, you won't be able to deduct the entire amount of your home office deduction this year (although you may carry it over and deduct it in a later year when your net business income is higher). “

Looks like only the home office deduction has to stop at 0 and then you carryforward the rest. Otherwise you just end with a NOL for the year.

AUD----92 5/31/12
FAR----92 7/3/12
RED----85 8/3/12
BEC----?? 8/29/12

[Shay]

@IfThereIsaGod…WOW..thanks. I understand the concept already.

When the answer sheet ask for GROSS RECEIPTS..I entered $50,000…Then next, it asked for Supplies..I enter $200. all the way down to Net Income was getting $197,000. I went back and change Supplies to ($200) negative number. and now my Net income is $0.

so, thats what I was trying to find out, if I entered expense as negative or positive numbers

[IfThereIsaGod]

Oh yes of course enter as negative numbers. If your using becker just read the instructions they tell you that! 🙂

AUD----92 5/31/12
FAR----92 7/3/12
RED----85 8/3/12
BEC----?? 8/29/12

[Shay]

thats tell me, My brain is tired of TAX now. I should just to take the exam..THANKS @IfThereIsaGod

[k1zuna]

thanks guys I was looking for an answer to this… #FLIPPINGOUT@THENITTYGRITTYDETAILS

FAR - Passed
AUD - Passed
BEC - Passed
REG - 8/22/2013

[Author]

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