Fall, $2024$

E$-$Reserves Problem $6-1$

Doreen$$s filing status is head of household. She owns and operates a hardware store, which

has the following revenues and expenses for the current year.

Revenue $ $350,000$

Expenses:

Cost of goods sold $90,000$

Property taxes $70,000$

Repairs and maintenance $50,000$

Advertising and other costs $30,000$

During $2024,$ Doreen received corporate bond interest income of $$9,900,$ qualified dividend

income of $$7,000,$ and has net capital gains of $$8,000.$ She has no other items that would

affect her adjusted gross income $($AGI$).$ Her itemized deductions total $$20,000.$

Required:

a$.$ Using good form, compute Doreen$$s qualified business net income $($QBI$)$ generated from

her hardware store.

b$.$ Using good form, compute Doreen$$s Modified Taxable Income, and also her QBI

deduction for $2024.$

c$.$ Assume that Doreen received corporate bond interest income of $$50,000,$ not $$9,900$; and

that itemized deductions total $30,000,$ not $$20,000.$ Using good form, compute Doreen$$s

Modified Taxable Income, and also her QBI deduction for $2024.$