Ron is a farmer and the year ended 30 June 2020 has been a bad one for his farm as he made a loss of $80,000 (on sales of $60,000). During the year Ron also worked part-time at a clothing store in the town to help supplement his income. Ron was paid $30,000 in gross wages for that part-time work. What would Ron's taxable income be for the year ended 30 June 2020?
A) Ron's taxable income would be a ($50,000) loss and there would no deferred non-commercial loss
B) Ron's taxable income would be a ($80,000) loss and he would have a deferred non-commercial loss of $30,000
C) Ron's taxable income would be a ($50,000) loss and he would have a deferred non-commercial loss of $30,000
D) Ron's taxable income would be $0 and he would have a deferred non-commercial loss of $80,000

Question

Quizplus · Accepted Answer

Ron's taxable income would be a ($50,000) loss because his part-time wages of $30,000 would offset part of his $80,000 loss from farming, resulting in a net loss of $50,000. There would be no deferred non-commercial loss because all income and losses have been accounted for in this calculation.

Ron Is a Farmer and the Year Ended 30 June