A Firm Must Capitalize Start-Up Expenditures of a New Business

question 52

True/False

A firm must capitalize start-up expenditures of a new business in excess of $5,000 but may deduct expansion costs of an existing business.

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Definitions:

Fraudulent Misrepresentation

The act of intentionally providing false information with the aim of deceiving another party, often to induce them into a contract.

Mutual Mistake

A misunderstanding shared by both parties involved in a contract, leading to a misalignment in agreement terms.

Blackmails

The act of demanding payment or another benefit from someone in return for not revealing compromising or damaging information about them.

Voidable

A term referring to a legal agreement or transaction that is valid but may be annulled by one of the parties involved.