Mr Haugh Owns a Sporting Goods Store as a Sole

question 17

Multiple Choice

Mr. Haugh owns a sporting goods store as a sole proprietorship. This year, he donated baseball equipment (bats, gloves, balls) to the local YMCA to use in their community sports programs. His cost basis in the inventory items was $45,700, and their retail value was $68,200. Which of the following statements about this donation is true?

• A) Mr. Haugh must recognize $22,500 ordinary business income and is allowed a $68,200 business deduction.
• B) Mr. Haugh must recognize $22,500 ordinary business income and is allowed a $68,200 charitable contribution deduction.
• C) Mr. Haugh is allowed a $45,700 charitable contribution deduction.
• D) Mr. Haugh is allowed a $68,200 charitable contribution deduction.

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Definitions:

Expected Frequency

The forecasted count for how many times an event is projected to happen, based on its statistical probability.

Expected Frequency

In statistics, it refers to the number of occurrences or outcomes that are predicted or expected to happen in a certain context based on a theoretical distribution.

Police Job

Employment involving enforcing the law, maintaining public order, and protecting citizens and property.

Expected Frequency

In statistics, the predicted count of occurrences in each category of a variable, assuming the null hypothesis is true.