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Kim works for a clothing manufacturer as a dress designer. During 2021, she travels to New York City to attend five days of fashion shows and then spends three days sightseeing. Her expenses are as follows: Airfare $2,050 Lodging (8 nights) 2,665 Meals at local restaurants (8 days) 2,460 Airport transportation 135 Assume lodging/meals are the same amount for the business and personal portion of the trip ($333 per day for lodging and $308 per day for meals). If an amount is zero, enter "0". If required, round all interim calculations to nearest dollar. a. Determine Kim's business expenses, presuming no reimbursement. Airfare Lodging Meals Transportation Total What amount may she deduct on her tax return? b. Would the tax treatment of Kim's deduction differ if she was an independent contractor? The deductible expenses would be $ and the expenses would be classified as

Kim works for a clothing manufacturer as a dress designer. During 2021, she travels to New York City to attend five days of fashion shows and then spends three days sightseeing. Her expenses are as follows: Airfare $2,050 Lodging (8 nights) 2,665 Meals at local restaurants (8 days) 2,460 Airport transportation 135 Assume lodging/meals are the same amount for the business and personal portion of the trip ($333 per day for lodging and $308 per day for meals). If an amount is zero, enter "0". If required, round all interim calculations to nearest dollar. a. Determine Kim's business expenses, presuming no reimbursement. Airfare Lodging Meals Transportation Total What amount may she deduct on her tax return? b. Would the tax treatment of Kim's deduction differ if she was an independent contractor? The deductible expenses would be $ and the expenses would be classified as

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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**Kim's Business Expenses for Travel to New York City** Kim works for a clothing manufacturer as a dress designer. During 2021, she travels to New York City to attend five days of fashion shows and then spends three days sightseeing. Her expenses are as follows: - **Airfare:** $2,050 - **Lodging (8 nights):** $2,665 - **Meals at local restaurants (8 days):** $2,460 - **Airport transportation:** $135 *Assume lodging/meals are the same amount for the business and personal portion of the trip ($333 per day for lodging and $308 per day for meals).* ### Instructions: If an amount is zero, enter "0". If required, round all interim calculations to the nearest dollar. **a. Determine Kim's business expenses, presuming no reimbursement.** | Expense | Amount | |----------------|---------| | Airfare | $ | | Lodging | $ | | Meals | $ | | Transportation | $ | | Total | $ | *What amount may she deduct on her tax return?* $_________ **b. Would the tax treatment of Kim's deduction differ if she was an independent contractor?** The deductible expenses would be $_________ and the expenses would be classified as _________.
Transcribed Image Text:**Kim's Business Expenses for Travel to New York City** Kim works for a clothing manufacturer as a dress designer. During 2021, she travels to New York City to attend five days of fashion shows and then spends three days sightseeing. Her expenses are as follows: - **Airfare:** $2,050 - **Lodging (8 nights):** $2,665 - **Meals at local restaurants (8 days):** $2,460 - **Airport transportation:** $135 *Assume lodging/meals are the same amount for the business and personal portion of the trip ($333 per day for lodging and $308 per day for meals).* ### Instructions: If an amount is zero, enter "0". If required, round all interim calculations to the nearest dollar. **a. Determine Kim's business expenses, presuming no reimbursement.** | Expense | Amount | |----------------|---------| | Airfare | $ | | Lodging | $ | | Meals | $ | | Transportation | $ | | Total | $ | *What amount may she deduct on her tax return?* $_________ **b. Would the tax treatment of Kim's deduction differ if she was an independent contractor?** The deductible expenses would be $_________ and the expenses would be classified as _________.
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