Shelley Is Self-Employed in Texas and Recently Attended a Two-Day

question 73

Multiple Choice

Shelley is self-employed in Texas and recently attended a two-day business conference in New Jersey. After Shelley attended the conference, she had dinner with an old friend who lived nearby. Shelly documented her expenditures (described below) . What amount can Shelley deduct?

• A)$2,850.
• B)$2,740.
• C)$1,850 if Shelley itemizes the deductions.
• D)All of these expenses are deductible but only if Shelley attends a conference in Texas.
• E)None of the expenses are deductible because Shelly visited her friend.

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Definitions:

Working Capital Investment

Funds used to finance day-to-day business operations, such as inventory purchase and accounts receivable.

Discount Rate

The interest rate used to discount future cash flows to their present values.

Net Present Value

The gap between the present worth of money coming in and going out over an established duration.

Pretax Return

The income or profit of a company before income tax expenses are deducted.