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Hackman Corporation began on September 23rd of the current year. Hackman incurred $40,000 of start-up costs and $60,000 of organizational expenditures. The start-up costs are comprised of wages (50%) and utilities (50%) before September 23. Assuming the correct response is C, how much in total may be deducted in this year? A. 2, 222 B. 5,000 C. 7,111 D. 12, 111 E. 2,111 The answer is C 7,111 based off the book, but would like to understand the steps.

Hackman Corporation began on September 23rd of the current year. Hackman incurred $40,000 of start-up costs and $60,000 of organizational expenditures. The start-up costs are comprised of wages (50%) and utilities (50%) before September 23. Assuming the correct response is C, how much in total may be deducted in this year? A. 2, 222 B. 5,000 C. 7,111 D. 12, 111 E. 2,111 The answer is C 7,111 based off the book, but would like to understand the steps.

FINANCIAL ACCOUNTING
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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Hackman Corporation began on September 23rd of the current year. Hackman incurred $40,000 of start-up costs and $60,000 of organizational expenditures. The start-up costs are comprised of wages (50%) and utilities (50 %) before September 23. Assuming the correct response is C, how much in total may be deducted in this year? A. 2, 222 B. 5,000 C. 7,111 D. 12, 111 E. 2, 111 The answer is C 7,111 based off the book, but would like to understand the steps.
Transcribed Image Text:Hackman Corporation began on September 23rd of the current year. Hackman incurred $40,000 of start-up costs and $60,000 of organizational expenditures. The start-up costs are comprised of wages (50%) and utilities (50 %) before September 23. Assuming the correct response is C, how much in total may be deducted in this year? A. 2, 222 B. 5,000 C. 7,111 D. 12, 111 E. 2, 111 The answer is C 7,111 based off the book, but would like to understand the steps.
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