Jim Operates a Business Out of His Home

question 63

Multiple Choice

Jim operates a business out of his home. One room in his home is used for business and qualifies as a home office. Which of the following allocable expenditures can Jim use in computing his home office expense deduction?
I.Jim pays his housekeeper $25 a week to sweep, dust and straighten-up his office.
II.Jim's fire and casualty insurance premiums on his home are $800.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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Definitions:

Overestimated

To assess or judge something to be greater, larger, or more important than it actually is.

Plus or Minus

Often used to indicate the precision of an estimate, measurement, or mathematical result, representing a range of possible values.

Sensory

Relating to or involving the senses or sensation, including sight, sound, taste, touch, and smell.

Short-Term

Pertaining to a limited time period, often in reference to memory, indicating retention of information for a brief duration.