Which of the Following Expenses, If Any, Is/are Deductible

question 62

Multiple Choice

Which of the following expenses, if any, is/are deductible?

• A)Contribution to a Roth IRA.
• B)Costs involved in maintaining an office in the home by a self-employed insurance adjuster.Taxpayer's wife also uses the office as a meeting place for her bridge club.
• C)Cost of moving to first job location.Taxpayer just graduated from college.
• D)Job-hunting expenses of a fishing guide to become an insurance salesman.
• E)None of the above.

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Definitions:

Fixed Component

The portion of a cost or expense that remains constant regardless of changes in the volume of goods or services produced or sold.

Dependent Variable

A variable that responds to some causal factor; total cost is the dependent variable, as represented by the letter Y, in the equation Y = a + bX.

Fixed Cost

Costs that do not change with the level of production or sales, such as rent or salaries.

Total Expense

The sum of all costs and expenses associated with the operations of a business.