George Operates a Business That Generated Revenues of $50 Million

question 99

Multiple Choice

George operates a business that generated revenues of $50 million and allocable taxable income of $1.25 million. Included in the computation of allocable taxable income were deductible expenses of $240,000 of business interest and $250,000 of depreciation. What is the maximum business interest deduction that George will be eligible to claim this year?

• A)$375,000
• B)$522,000
• C)$1,500,000
• D)$300,000
• E)$228,000

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Definitions:

Interdependent

A state in which two or more entities rely on each other for support, survival, or functioning.

Innate

Describes qualities or abilities present from birth, not acquired later.

Universal

A concept or condition that applies to all members of a given category or thing, without exceptions.

Linguistic-Relativity Hypothesis

A theory suggesting that the structure of a language affects its speaker's worldview or cognition.