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Henrietta, the owner of a very successful hotel chain in the Southeast, is exploring the possibility of expanding the chain into a city in the Northeast. She incurs $35,000 of expenses associated with this investigation. Based on the regulatory environment for hotels in the city, she decides not to expand. During the year, she also investigates opening a restaurant that will be part of a national restaurant chain. Her expenses for this are $53,000. She proceeds with opening the restaurant, and it begins operations on September 1.

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  1. 16 December, 11:50
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    Answer: Explanation:

    The amount that Nancy can deduct in the current year for investigating these two businesses.

    Nancy could deduct the $35,000 for hotel investigation expenses.

    Nancy can deduct $2,000 + $1133 = $3,133 of the restaurant expenses the first year and then the other $51,000 over a period of 180 months, that is $1133 per month.
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