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bazaltina [42]
3 years ago
15

Manny hired his brother’s firm to provide accounting services to his business. During the current year, Manny paid his brother’s

firm $94,000 for services even though other firms were willing to provide the same services for $64,000. How much of this expenditure, if any, is deductible as an ordinary and necessary business expenditure?
Business
1 answer:
Naily [24]3 years ago
3 0

Answer:

$64,000

Explanation:

In order to be deductible, a business expense must be both ordinary and necessary. Being ordinary means that it is a plausible expense for this business, since the expense in question is related to accounting services, it is ordinary. Being necessary means that the expense is the minimum required and is appropriate and helpful to the business. In this case, all of the expense was not required, therefore, only $64,000 (the reasonable market value for the services provided) are deductible.

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3 years ago
When creditors, managers, and investors look at expenses as a percentage of revenue, they are __________.
sineoko [7]

Answer:

Doing a financial statement analysis.

Explanation:

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7 0
3 years ago
West Corp. issued 15-year bonds two years ago at a coupon rate of 7.3 percent. The bonds make semiannual payments. If these bond
MaRussiya [10]

Answer:

7.44 %

Explanation:

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The Yield to Maturity can be calculated using a financial calculator as follows :

PV = - $100

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3 years ago
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