Which of the Following Is/are Trade or Business Expenses

question 113

Multiple Choice

Which of the following is/are trade or business expenses?
I.Solly incurs legal expenses related to real estate he leases to Bucko Burger Hamburger Haven for a parking lot. Solly does little but negotiate the lease every year..
II.Susan owns several rental apartments. She negotiates new rental contracts, arranges for repairs and maintenance, and handles all leasing activities.
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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:

Financial Statements

Documents that present the financial activities and conditions of a business or entity, including the balance sheet, income statement, and cash flow statement.

Basic Assumptions

Fundamental accounting principles that underpin the preparation and presentation of financial statements.

Principles

Fundamental truths or propositions that serve as the foundation for a system of belief or behavior or for a chain of reasoning.

Adjusted Trial Balance

A trial balance prepared after adjusting entries are made and posted, ensuring that debits and credits still match.