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5 August, 05:20

During the year, Sophie (a self-employed marketing consultant) went from Omaha to Lima (Peru) on business. She spent four days on business, two days on travel, and four days on vacation. Disregarding the vacation costs, Sophie's expenses are: Air fare $3,000 Lodging 800 Meals 600 Entertainment 400 Sophie's deductible expenses are:

a. $4,300.

b. $2,900

c. $2,800.

d. $2,500.

e. None of these.

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  1. 5 August, 07:32
    0
    e. None of these.

    Explanation:

    The deductible expenses are expenses that are wholly, necessarily and exclusively for business purpose. This excludes the entertainment cost which is the only avoidable cost in the classes of cost given.

    Hence, Sophie's deductible expenses are

    = $3,000 + $800 + $600

    = $4,400
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