The following facts pertain to Catchall Consulting, a sole proprietorship owned

Question

The following facts pertain to Catchall Consulting, a sole proprietorship owned by Peabody:

20X09 net profit or (loss):

($ 5,000)

20X10 net profit or (loss):

$      250

20X11 net profit or (loss):

$      500

20X12 net profit or (loss):

($ 1,200)

20X13 net profit or (loss):

$       800

In 20X14 Peabody gave out 50 promotional clipboards to prospective clients, at a cost of $3 per clipboard. What amount of business expense can Peabody include, as a result of the clipboards, on Peabody’s 20X14 Schedule C?

20X09 net profit or (loss):

($ 5,000)

20X10 net profit or (loss):

$      250

20X11 net profit or (loss):

$      500

20X12 net profit or (loss):

($ 1,200)

20X13 net profit or (loss):

$       800

Explanation / Answer

Answer  

given peabody gave clipboards to prospective clints = 50

cost per clipboard = 3

total expences of peabody clipboard = 50 * 3

= $ 150

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