part of a natio - $52,600. She proceeds with opening the restaurant, and it begins operations on May 1. nt that Henrietta can deduct in the current year for investigating these two businesses. ons, round the per-month amount to the nearest dollar and use rounded amount ins nount of investigation expenses related to expansion of her hotel chain into another city: $ nount of investigation expenses related to opening a restaurant: $ 4,631 X

CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN:9780357110362
Author:Murphy
Publisher:Murphy
Chapter5: Introduction To Business Expenses
Section: Chapter Questions
Problem 40P
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Henrietta, the owner of a very successful hotel chain in the Southeast, is exploring the possibility of expanding the chain into a city in the
Northeast. She incurs $60,000 of expenses associated with this investigation. Based on the regulatory environment for hotels in the city,
she decides not to expand. During the year, she also investigates opening a restaurant that will be part of a national restaurant chain. Her
expenses for this are $52,600. She proceeds with opening the restaurant, and it begins operations on May 1.
Determine the amount that Henrietta can deduct in the current year for investigating these two businesses.
In your computations, round the per-month amount to the nearest dollar and use rounded amount in subsequent
computations.
a. The deductible amount of investigation expenses related to expansion of her hotel chain into another city: s
60,000 v
b. The deductible amount of investigation expenses related to opening a restaurant: $
4,631 X
Transcribed Image Text:Henrietta, the owner of a very successful hotel chain in the Southeast, is exploring the possibility of expanding the chain into a city in the Northeast. She incurs $60,000 of expenses associated with this investigation. Based on the regulatory environment for hotels in the city, she decides not to expand. During the year, she also investigates opening a restaurant that will be part of a national restaurant chain. Her expenses for this are $52,600. She proceeds with opening the restaurant, and it begins operations on May 1. Determine the amount that Henrietta can deduct in the current year for investigating these two businesses. In your computations, round the per-month amount to the nearest dollar and use rounded amount in subsequent computations. a. The deductible amount of investigation expenses related to expansion of her hotel chain into another city: s 60,000 v b. The deductible amount of investigation expenses related to opening a restaurant: $ 4,631 X
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