Smith Operates a Roof Repair Business The Education Expense Was for a Two-Week, Nighttime Course in Generated

question 87

Short Answer

Smith operates a roof repair business. This year Smith's business generated cash receipts of $32,000 and Smith made the following expenditures associated with his business: $$\begin{array} { l r } \text { Advertising } & \$ 500 \\\text { Car and truck expenses } & 1,360 \\\text { Depreciation } & 3,200 \\\text { Employee compensation } & 5,000 \\\text { Education } & 1,000\end{array}$$ The education expense was for a two-week, nighttime course in business management. Smith believes the expenditure should qualify as an ordinary and necessary business expense. What net income should Smith report from his business? Smith is on the cash method and calendar year.

---

Definitions:

Hand-Off Report

A communication tool used by healthcare professionals to transfer essential information and responsibility for care of a patient from one caregiver to another.

Ambulatory Surgery

Surgical procedures that do not require an overnight hospital stay, allowing the patient to return home the same day.

Risk Factors

Factors that heighten the chance of acquiring an illness or sustaining an injury.

Obesity

Abnormal increase in the proportion of fat cells, mainly in the viscera and subcutaneous tissues of the body.