Marc Lusebrink, sole proprietor of Oak Company, bought a used automobile and drove it 13,120 miles for business during 2019 and a total (including business miles) of 16,000 miles. His total expenses for his automobile for the year are:   Gasoline $2,061   Oil changes 92   Insurance 1,030   Tires 225   Repairs 620   Total $4,028   The automobile cost $20,000 on January 1, and depreciation expense for the year, including business use, was $4,000. His business parking and toll fees for business amount to $327. Calculate Marc's transportation expense deduction for the year under each method listed below. Round business use to the nearest whole percentage. If required, round your answers to the nearest dollar. Standard Mileage Method: $Actual Cost Method:     $ Which method should Marc use?

Income Tax Fundamentals 2020
38th Edition
ISBN:9780357391129
Author:WHITTENBURG
Publisher:WHITTENBURG
Chapter3: Business Income And Expenses
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Problem 6P: Teresa is a civil engineer who uses her automobile for business. Teresa drove her automobile a total...
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Marc Lusebrink, sole proprietor of Oak Company, bought a used automobile and drove it 13,120 miles for business during 2019 and a total (including business miles) of 16,000 miles. His total expenses for his automobile for the year are:

 
Gasoline $2,061  
Oil changes 92  
Insurance 1,030  
Tires 225  
Repairs 620  
Total $4,028  

The automobile cost $20,000 on January 1, and depreciation expense for the year, including business use, was $4,000. His business parking and toll fees for business amount to $327.

Calculate Marc's transportation expense deduction for the year under each method listed below.

Round business use to the nearest whole percentage. If required, round your answers to the nearest dollar.

Standard Mileage Method: $

Actual Cost Method:     $

Which method should Marc use?

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