In 2014,Miguel Accepted a New Job and Moved from San

question 107

Essay

In 2014,Miguel accepted a new job and moved from San Diego to Boston to begin work.He incurred moving expenses for his household goods and furniture of $3,500.Prior to moving,Miguel flew to Boston to look for a new residence.The transportation and lodging for this trip to Boston was $900 and his meals were $150.The cost of his travel during the actual move to Boston was $500 which included $75 for meals.Calculate the amount of Miguel's moving expense deduction for 2014.

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Definitions:

Adjusting Entry

Refers to adjustments made in the books of accounts to record expenses or revenues that have occurred but are not accurately represented in financial statements.

Write Off

The act of removing an asset from the financial statements due to its impairment or irrelevance, recognizing it as a loss.

Estimated Bad Debts

An account on the financial statements estimating the amount of receivables that a company does not expect to collect.

Percentage of Sales Method

An accounting technique used to estimate bad debts or the allowance for doubtful accounts based on a predetermined percentage of sales.