Paul, a Business Consultant, Regularly Takes Clients and Potential Clients

question 410

Multiple Choice

Paul, a business consultant, regularly takes clients and potential clients out to dinner. In order to deduct these expenses, Paul must maintain records substantiating all of the following except

• A) the business purpose of the dinners.
• B) the time and place of the dinners.
• C) the business relationship with the person invited.
• D) All of the above information must be substantiated in order to deduct the entertainment costs.

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Definitions:

Purchase Price

The amount of money paid by a buyer to acquire ownership of a product or property.

Unenforceable

A term describing a contract or clause that cannot be upheld or compelled by law.

Not in Writing

Refers to agreements or communications that haven't been formally recorded on paper or in any digital format.

Electric Pencil Sharpener

A device powered by electricity used for sharpening pencils through a rotating mechanism.