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Joe and Jessie are married and have one dependent child, Lizzie. Lizzie is currently in college at
State University. Joe works as a design engineer for a manufacturing firm, while Jessie runs a
craft business from their home. Jessie's craft business consists of making craft items for sale at
craft shows that are held periodically at various locations. Jessie spends considerable time and
effort on her craft business, and it has been consistently profitable over the years. Joe and Jessie
own a home and pay interest on their home loan (balance of $220,000 ) and a personal loan to
pay for Lizzie's college expenses (balance of $35,000 ). Neither Joe nor Jessie is blind or over age
65, and they plan to file as married-joint. Assume that the employer portion of the self-employment
tax on Jessie's income is $710. Joe and Jessie have summarized the income and expenses they
expect to report this year as follows:Comprehensive Problem 6-65 Part-a (Algo) a. Determine Joe
and Jessie's AGI and taxable income for the year. Note: Round your intermediate calculations to
the nearest whole dollar amount.

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