Mattie and Elmer Are Separated and Are in the Process

question 88

Essay

Mattie and Elmer are separated and are in the process of obtaining a divorce. They incur legal fees for their respective attorneys with the expenses being itemized as follows:
​
Although there is no requirement that he do so, Elmer pays Mattie's lawyer as a gesture of the positive feelings he still has for her.
a.Determine the deductions for Mattie and for Elmer.
b.Classify the deductions as for AGI and from AGI.

---

Definitions:

Income Tax Payable

A liability account on a company's balance sheet representing the taxes owed to the government but not yet paid.

Sales

The trading of products or services in return for money, which serves as the main income stream for the majority of companies.

Cost of Goods Sold

The immediate expenses incurred in the production of a company's sold goods, encompassing materials, labor, and overhead costs.

Operating Expenses

Expenses incurred during regular business operations, such as rent, utilities, and salaries, but excluding cost of goods sold.