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29 September, 15:42

Holly took a prospective client to dinner, and after agreeing to a business deal, they went to the theater. Holly paid $450 for the meal and separately paid $186 for the theater tickets, amounts that were reasonable under the circumstances. What amount of these expenditures can Holly deduct as a business expense?

A. $636

B. $225

C. $318

D. $93

E. None - the meals and entertainment are not deductible except during travel.

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Answers (1)
  1. 29 September, 18:46
    0
    Option B is correct one.

    $225

    Explanation:

    The cost of entertainment is not deductible. So the amount Holly can deduct as a business expense

    = $450 * 50% = $225.
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