A 4633 b 3544 c 2217 d 1733 92 pdq inc a calendar

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South-Western Federal Taxation 2020: Comprehensive
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Chapter 16 / Exercise 6
South-Western Federal Taxation 2020: Comprehensive
Maloney/Raabe/Young
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a. $4,633b. $3,544c. $2,217*d. $1,733
92. PDQ, Inc., a calendar-year company, paid $15,000 as a prepayment of two years of its liability insurance on November 1 of the current year. How much insurance expense can PDQ deduct on its current year income tax return?
93. HMP Inc. reported the following information: Net sales (U.S. production)$550,000Cost of goods sold300,000Operating expenses100,000W-2 wages for the year(included in cost of goods sold and operating expenses)80,000What is HMP's taxable income?
94. Moving expenses qualify as deductions if:
95. Taxpayers generally can deduct meal and entertainment expenses provided that the expenses are:a. less than five percent of the employer's gross profits.*b. directly related to or associated with the taxpayer's trade or business.c. spent solely on employees.
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South-Western Federal Taxation 2020: Comprehensive
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Chapter 16 / Exercise 6
South-Western Federal Taxation 2020: Comprehensive
Maloney/Raabe/Young
Expert Verified
96. Expenses that are costs paid or incurred while traveling around town on business are known as:
97. A self-employed attorney uses a country club to entertain clients and spends the following amounts at the club: Annual dues$1,000Personal meals1,500Business meals2,500What amount can the attorney deduct against business income on his personal tax return?
98. An employee of a corporation takes a 10-day trip from Chicago to New York. He spends seven days conducting business and three days sightseeing and visiting friends. His expenses included: Airfare$ 800Lodging (10 days at $280)2,800Meals (10 days at $100)1,000Entertainment of friends250$4,850The corporation reimburses the employee under an accountable plan. What amount of the $4,850 qualifies as deductible travel expenses for the corporation? a. $3,220b. $3,460*c. $3,110
99. If a taxpayer drives 10,000 business miles during 2013, and uses the standard mileage method, the taxpayer's deduction is:
100. Susanne Watson is an employee and sole-shareholder of Klaxon. Klaxon is a calendar-year company which uses the accrual method of accounting. On December 30, 2013, Klaxon awarded Susanne a bonus of $30,000 based on the company's 2012 year-end profit. The bonus was reasonable, ordinary and necessary. It was paid on February 11, 2014. In what year can Klaxon deduct the bonus it paid to Susanne? Susanne is a calendar-year, cash method taxpayer.

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