For Each of the Following Situations, Determine Whether the Item

question 40

Essay

For each of the following situations, determine whether the item is deductible, how it would be deducted on the taxpayer's return (if there are alternatives possible, discuss the conditions that would determine the treatment) and any limitations, which might be placed on the deduction.
a.Allison is self-employed. She pays the following taxes during the current year: $$\begin{array} { l r } \text { State income tax } & \$ 1,200 \\\text { Federal income tax } & 4,000 \\\text { Self-employment tax } & 3,200 \\\text { Property tax on residence } & 700 \\\text { Tax on business equipment } & 200\end{array}$$
b.A customer who owed Leon $5,000 declared bankruptcy last year. At that time, the customer's accountant estimated that only 40% of the customer's debts would be paid. In the current year, Leon receives $1,000 from the bankruptcy court as final payment on the $5,000 debt.

Analyze the role of both forward and backward integration within diversification strategies.

Evaluate the comparative success rates and resource requirements of different growth strategies.

Discuss how companies can extend the product life cycle through new product features or applications.

Understand the concept of market development and its execution strategies.