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16 March, 06:40

During the current year, Ashley Corporation charged the following payments to

miscellaneous expense:

Travel expense of $300 for the company president to offer

voluntary testimony at the state capital against proposed

legislation regarded as unfavorable to its business

Christmas gifts to 20 customers at $75 each

Contribution of $600 to local political candidate

The maximum deduction that Ashley can claim for these payments is

A. $800

B. $1,400

C. $1,800

D. $2,400

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Answers (1)
  1. 16 March, 10:17
    0
    option (D) $2,400

    Explanation:

    Data provided in the question:

    Payments to miscellaneous expense:

    Travel expense = $300

    Total value of Christmas gifts = 20 * $75 = $1,500

    Contribution to local political candidate = $600

    Now,

    The maximum deduction that Ashley can claim for these payments

    = Travel expense + Total value of Christmas gifts + Contribution to local political candidate

    = $300 + $1,500 + $600

    = $2,400

    Hence,

    The correct answer is option (D) $2,400
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