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1.  Ivory, Inc., has taxable income of $600,000 and qualified production activities income (QPAI) of $400,000 in 2010. Ivory's domestic production        $24,000.       $36,000.       $40,000.       $54,000.
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2.  Ridge is the manager of a motel. As a condition of his employment, Ridge is required to live in a room on the premises so  that he would be there in case of emergencies. Ridge considered this a fringe benefit, since he would otherwise be required  to pay $600 per month rent. The room that Ridge occupied normally rented for $60 per night, or $1,500 per month. On the  average, 90% of the motel rooms were occupied. As a result of this rent-free use of a room, Ridge is required to include in  gross income. (Points : 5)        $0.       $600 per month.
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