Mike Is a Self-Employed TV Technician

Essay

Mike is a self-employed TV technician.He is usually paid as soon as he completes repairs,but occasionally bills a customer with payment expected within 30 days.At the end of the year he has $2,500 of receivables outstanding.He expects to collect $1,200 of this and write off the remainder.Mike is a cash basis taxpayer and had net earnings from his business (not including the effect of the items above)of $55,000.He also had $3,500 interest income,$200 gambling winnings,and sold corporate stock for $7,000.The stock had been purchased in 1998 for $8,200.Mike is single,has no dependents,and claims the standard deduction.What is his 2010 taxable income? (Ignore the self-employment tax deduction. )