75 or 100% b) Yes, because this causes Saturday, Sunday and Monday to be nonbusiness days     or     No, because this causes Saturday and Sunday to be

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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100%

the answer for

a) sholud be either 0,25,75 or 100%

b) Yes, because this causes Saturday, Sunday and Monday to be nonbusiness days     or     No, because this causes Saturday and Sunday to be business day

c) Under part a) and b) what percentage of the airfare is deductible either 25, 50, 80, all or none

Problem 9-26 (LO. 3)
On Thursday, Justin flies from Baltimore (where the office for his sole proprietorship is located) to Cadiz (Spain). He conducts business on
Friday and Tuesday; vacations on Saturday, Sunday, and Monday (a legal holiday in Spain); and returns to Baltimore on Thursday. Justin is
scheduled to return home on Wednesday, but all flights were canceled due to bad weather. As a result, he spends Wednesday watching floor
shows at a local casino. Days where travel is attempted/cancelled is counted as a travel day under tax law. Justin is self-employed.
a. For tax purposes, what portion of Justin's trip is regarded as being for business?
100%
b. Suppose Monday was not a legal holiday. Would this change your answer about what percentage of Justin's trip would be regarded as
business?
Yes, because this causes Saturday, Sunday, and Monday to be nonbusiness days.
c. Under either part (a) or (b), how much of Justin's airfare qualifies as a deductible business expense?
Under part (a), all of the airfare would be deductible
Under part (b), all of the airfare would be deductible
Transcribed Image Text:Problem 9-26 (LO. 3) On Thursday, Justin flies from Baltimore (where the office for his sole proprietorship is located) to Cadiz (Spain). He conducts business on Friday and Tuesday; vacations on Saturday, Sunday, and Monday (a legal holiday in Spain); and returns to Baltimore on Thursday. Justin is scheduled to return home on Wednesday, but all flights were canceled due to bad weather. As a result, he spends Wednesday watching floor shows at a local casino. Days where travel is attempted/cancelled is counted as a travel day under tax law. Justin is self-employed. a. For tax purposes, what portion of Justin's trip is regarded as being for business? 100% b. Suppose Monday was not a legal holiday. Would this change your answer about what percentage of Justin's trip would be regarded as business? Yes, because this causes Saturday, Sunday, and Monday to be nonbusiness days. c. Under either part (a) or (b), how much of Justin's airfare qualifies as a deductible business expense? Under part (a), all of the airfare would be deductible Under part (b), all of the airfare would be deductible
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