Mr Sherman Incurred $7,000 of Employment-Related Business Expenses

question 29

Multiple Choice

Mr. Sherman incurred $7,000 of employment-related business expenses. Which of the following statements is true?

• A) If his employer reimbursed him for these expenses, Mr. Sherman must include the reimbursement in gross income.
• B) If his employer reimbursed him for $3,000 of the expenses, Mr. Sherman is allowed a $4,000 above-the-line deduction.
• C) If his employer reimbursed him for $3,000 of the expenses, Mr. Sherman is allowed a $4,000 itemized deduction.
• D) If his employer reimbursed him for $3,000 of the expenses, Mr. Sherman has a $4,000 nondeductible expense.

---

Definitions:

Automobile Engine

A machine designed to convert various forms of energy into mechanical force and motion to power an automobile.

Probability

An indicator of the probability of an event happening, expressed as a numeric value ranging from 0 to 1, with 0 meaning the event cannot happen and 1 meaning the event is certain to happen.

Poisson Distribution

A probability distribution used to model the number of times an event occurs in a fixed interval of space or time.

Rebuilt Ignition Systems

Ignition systems that have been taken apart, inspected, repaired, and reassembled to ensure they meet certain standards.