Haley, a Self-Employed Individual, Drove Her Automobile a Total of 20,000

question 17

Multiple Choice

Haley, a self-employed individual, drove her automobile a total of 20,000 business miles in 2018. This represents about 75% of the auto's use. She has receipts as follows: If Haley uses the standard mileage rate method, how much can she deduct as a business expense?

• A) $12,500
• B) $11,600
• C) $11,200
• D) $11,000

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Definitions:

Planned Activity Level

The expected volume of production or sales used in budgeting and decision-making processes.

Machine Hours

A measure of the amount of time a machine is operated, used for allocating manufacturing costs.

Flexible Budget Total

A financial plan that adjusts or varies with changes in the volume of activity or business.

Direct Labor Hours

The total hours of labor directly involved in producing goods or services, often used as a basis for allocating overhead costs.