Question

Holly took a prospective client to dinner, and after agreeing to a business deal, they went to the theater. Holly paid $460 for the meal and separately paid $182 for the theater tickets, amounts that were reasonable under the circumstances. What amount of these expenditures can Holly deduct as a business expense? Multiple Choice None-the meals and entertainment are not deductible except during travel. $91 $642 $321 $230

Answer 1

SOLUTION

ONLY 50 % OF MEALS AND ENTERTAINMENT EXPENSE IS ALLOWED.

TOTAL EXPENSE = 460+182 = 642

50% ALLOWED = 642 X 50% = 321 (ANSWER)