Kim used to work at "The Big One" accounting firm, and she earned $50,000 a year. She saved her money and has now invested $100,000 in her own firm. Profit is $20,000 a year, which Kim receives as her only compensation. She concludes that this is great because a 20 percent return is much better than the 8 percent she could get in another investment (the opportunity cost of the funds). What is wrong with this line of thinking?

In year 1, the bennetts' 25-year-old daughter, jane, is a full-time student at an out-of-state university but she plans to return home after the school year ends. in previous years, jane has never worked and her parents have always been able to claim her as a dependent. in year 1, a kind neighbor offers to pay for all of jane's educational and living expenses. which of the following statements is most accurate regarding whether jane's parents would be allowed to claim an exemption for jane in year 1 assuming the neighbor pays for all of jane's support? a.no, jane must include her neighbor's gift as income and thus fails the gross income test for a qualifying relative.b.yes, because she is a full-time student and does not provide more than half of her own support, jane is considered her parent's qualifying child.c.no, jane is too old to be considered a qualifying child and fails the support test of a qualifying relative.d.yes, because she is a student, her absence is considered as "temporary." consequently she meets the residence test and is a considered a qualifying child of the bennetts.