1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
allochka39001 [22]
3 years ago
15

In March of the current year, Marcus began investigating the possibility of opening a specialty clothing store. From March throu

gh June, he spent $2,300 on a market survey, $2,700 in consulting fees to find the best location and $3,600 in professional fees setting up an accounting and inventory system. Although he had never run his own business before, on August 1 he opened his doors for business. What is the maximum amount of deduction for the current year attributable to these expenditures?
Business
1 answer:
erik [133]3 years ago
7 0

Answer:

Total deduction attributable to the current year = $5,000 + $100= $5,100

Explanation:

First, the multiple choices for the question

a. $8,600

b. $5,000

c. $5,100

d. $5,240

e. 0

Solution

First, we determine the total expenditure for the start-up as follows

Market survey + Consulting fees + Professional Fees

= $2,300 + $2,700 + $3,600 = $8,600

However, we are also aware that only $5,000 can be out rightly deducted in the first year of business, while the remaining ($8,600-$5,000) = $3,600 is to be deducted over a period of 180 months

Deduction over 180 months = $3,600 / 180 months = $20 per month

Finally, since the business started August 1st, it means the business ran form August to December (5 months) for the current year.

Hence, the additional deduction for the year = $20 x 5 = $100

Total deduction attributable to the current year = $5,000 + $100= $5,100

You might be interested in
Who are the persons that might help you to establish your business?​
ZanzabumX [31]

Answer:

Your spouse. One of the first people you should talk with about this new venture is your spouse.

A lawyer.

An accountant and trusted advisor

A business coach or mentor.

A banker.

Explanation:

Have a wonderful day !! :)

6 0
3 years ago
A company normally sells its product for $20 per unit. However, the selling price has fallen to $15 per unit. This company's cur
nata0808 [166]

Answer:

$200 (a deduction)

Explanation:

The accounting standard for inventories IAS 2 requires that inventory be carried at the lower of cost or net realizable value. Inventory will initially be recognized at the cost ( which includes the cost of the item and other associated cost such as freight ). However, its carrying amount must be reviewed to ensure it is not higher than the realizable value.

Given that the selling price is now $15 which is lower than the cost of $16, it means that the amount that can be realized from the sale of a unit is $15.

= $16 - $15

= $1

As such, an adjustment in form of a reduction of the carrying amount of $1 per unit is required. The amount of the lower cost of market adjustment the company must make as a result of this decline in value

= $1 × 200 units

= $200 (a deduction)

8 0
3 years ago
The overhead volume variance relates only to
Fofino [41]
D fixed overhead cost
5 0
3 years ago
Bradley is sitting on his porch enjoying his very large front yard and drinking a lemonade when chris, a kid from down the stree
Anestetic [448]
<span>Chris may be able to recover money from the courts on the basis of quasi contract. A quasi contract is an obligation of one party to another imposed by law independently of an agreement between the parties.</span>
3 0
3 years ago
what would the length of time you have had a checking or savings account help determine your credit score?
GenaCL600 [577]

It shows a pattern of responsibility.

If you have only had accounts for 1 month, it doesn't really give a full picture of whether or not you always make your payments on time, etc. However if you have had accounts for 20 years, creditors have more history to look through to determine if you are responsible.

Keep in mind, checking and savings accounts are not the primary type of accounts that creditors want to look at because those only deal with spending money you already have. Lenders really want to know how you handle money that you <em>borrow</em>, such as school loans, credit cards, rent payments, and auto loans.

8 0
3 years ago
Other questions:
  • Why should companies be careful to report cash and cash equivalents correctly?
    15·1 answer
  • At December 31, 2018, before any year-end adjustments, Concord Company's Insurance Expense account had a balance of $2570 and it
    13·1 answer
  • Crown Company established a petty cash fund of $600 for incidental expenditures on January 2, 2019. At the end of the month, the
    14·1 answer
  • Which of the following should not be included in accumulated other comprehensive income?Select one:A. Minimum pension liabilityB
    15·1 answer
  • Mrs. and Mr. Strange, who are filing a joint return, have adjusted gross income of $50,000 in 2019. During the tax year, they pa
    5·1 answer
  • Becton Labs, Inc., produces various chemical compounds for industrial use. One compound, called Fludex, is prepared using an ela
    10·1 answer
  • What does liquidity refer to?
    13·1 answer
  • Sixty to sixty-five percent of its value can be used as collateral for a loan.
    15·1 answer
  • Jefferson Company has sales of $300,000 and cost of goods available for sale of $270,000. If the gross profit ratio is typically
    5·1 answer
  • If the government tightens up on drug dealers and raises the costs of dealing illegal drugs, then the drug addicts' dollar expen
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!