Question 1 7 out of 7 points Barry is a self-employed attorney who travels to New York on a business trip during 2013.

Barry's expenses were as follows: Airfare $560 Taxis $ 40 Meals $100 Lodging $350 How much may Barry deduct as travel expenses for the trip? Correct Answer: $1,000

Question 2
7 out of 7 points Maria runs a small business out of her home. She has expenses of $2,000 per year and uses the cash basis method of accounting. Her only employee is her cousin who works for her parttime. What form should she use to report her business income? Correct Answer: Schedule C

Question 3
0 out of 7 points During the 2013 holiday season, Bob, a barber, gave business gifts to 34 customers. The values of the gifts, which were not of a promotional nature, were as follows: 8 at $10 each 8 at $25 each 8 at $50 each 10 at $100 each For 2013, what is the amount of Bob's business gift deduction? Correct Answer: $730

Question 4
7 out of 7 points Linda is self-employed and spends $600 for business meals and $400 for business entertainment in 2013. What is Linda allowed to deduct in 2013 for these expenses? Correct Answer: $500

Question 5
7 out of 7 points

Carlos drives to Oregon to consult with a client. He works for 1 day and spends 3 days enjoying Oregon since the consultation was right before a 3-day weekend. His expenses were $175 to drive to Oregon and back, $600 for lodging, $45 for food on the day that he worked, and $125 for food on the other 3 days. How much of his travel expenses are deductible? Correct Answer: $348

Question 6
7 out of 7 points What income tax form does a self-employed sole proprietor usually use to report business income and expense? Correct Answer: Schedule C

Question 7
0 out of 7 points Richard operates a hair styling boutique out of his home. The boutique occupies 300 of the homes 1,200 square feet of floor space. Other information is as follows: Gross income from the boutique $10,000 Supplies for the boutique $ 2,000 Depreciation on total residence $12,000 Utilities for total residence $ 6,000 What amount of income or loss from the boutique should Richard show on his return? Correct Answer: $3,500 income

Question 8
7 out of 7 points Patricia is a business owner who is trying to determine her cost of goods sold for 2013. She bought 20 units of inventory at $11, then 26 units at $9, and finally 18 units at $14. She sold 30 units in 2013 and uses FIFO for her inventory valuation. What was her cost of goods sold in 2013, assuming that there was no inventory at the beginning of the year? Correct Answer: $310

Question 9
0 out of 7 points Nancy owns a small dress store. During 2013, Nancy gives business gifts having the indicated cost to the following individuals: Mrs. Johns (a customer) $37 plus $3 shipping Mr. Johns (nonclient husband of Mrs. Johns) $10 Ms. Brown (a customer) $22 What is the amount of Nancy's deduction for business gifts?

Correct Answer: $50

Question 10
0 out of 7 points Taxpayers who make a combined business and pleasure trip: Correct Answer: Must allocate the travel cost between the business and pleasure parts of the trip if the travel is outside the United States.

Question 11
0 out of 7 points Jack is a lawyer who is a member at Ocean Spray Country Club where he spends $7,200 in dues, $4,000 in meals, and $2,000 in green fees to entertain clients. He is also a member of the local Rotary club where he meets potential clients. The dues for the Rotary club are $1,200 a year. How much of the above expenses can Jack deduct as business expenses? Correct Answer: $4,200

Question 12
7 out of 7 points Acacia Company had inventory of $100,000 on December 31, 2013. Other information is as follows: Purchases $1,500,000 Sales 3,000,000 Inventory 1/1/2013 300,000 What is the amount of Acacias cost of goods sold for 2013? Correct Answer: $1,700,000

Question 13
7 out of 7 points Tim loaned a friend $4,000 to buy a used car. In the current year, Tims friend declares bankruptcy and the debt is considered totally worthless. What amount may Tim deduct on his individual income tax return for the current year as a result of the worthless debt, assuming he has no other capital gains or losses for the year? Correct Answer: $3,000 short-term capital loss

Question 14
0 out of 7 points Ellen loans Nicole $45,000 to start a hair salon. Unfortunately, the business fails in 2013 and

she is unable to pay back Ellen. In 2013, Ellen also had $20,000 of income from her part-time job and $12,000 of capital gain from the sale of stock. How much of the $45,000 bad debt can Ellen claim as a capital loss in 2013? Correct Answer: $15,000, with $30,000 carried forward to 2014

Question 15
0 out of 7 points Which of the following expenses, incurred while on travel, does not qualify as a travel expense? Correct Answer: Gift purchased for a prospective customer ($20)