1. After a business meeting with a prospective client Holly took the client to dinner and the theatre. Holly paid $380 for the meal and $214 for the theatre tickets, amounts that were reasonable under the circumstances. What amount of these expenditures can Holly deduct as a business expense?

2. George operates a business that generated adjusted gross income of $251,000 and taxable income of $168,000 this year (before the domestic production activities deduction). Included in income was $68,000 of qualified production activities income. George paid $62,000 of wages to employees engaged in domestic manufacturing. What domestic production activities deduction will George be eligible to claim this year?

3. Big Homes Corporation is an accrual method calendar year taxpayer that manufactures and sells modular homes. This year for the first time Big Homes was forced to offer a rebate on the purchase of new homes. At year end, Big Homes had paid $13,200 in rebates and was liable for an additional $8,100 in rebates to buyers. What amount of the rebates, if any, can Big Homes deduct this year?

4. Manley operates a law practice on the accrual method and calendar year. At the beginning of the year Manley's firm had an allowance for doubtful accounts with a balance of $14,900. At the end of the year, Manley recorded bad debt expense of $22,200 and the balance of doubtful accounts had increased to $18,800. What is Manley's deduction for bad debt expense this year?

5. Don operates a taxi business, and this year one of his taxis was damaged in a traffic accident. The taxi was originally purchased for $15,500 and the adjusted basis was $1,450 at the time of the accident. The taxi was repaired at a cost of $2,775 and insurance reimbursed Don $733 of this cost. What is the amount of Don's casualty loss deduction?