1. Crystal operates a business that provides typing and delivery services. This year Crystal spent $2,610 to purchase special shirts that identify her employees and provide some notoriety for her business. The shirts are especially colorful and include logos on the front pocket and back. Besides salary payments, Crystal also compensates her employees by offering to pay whole life insurance premiums for any that want to provide insurance coverage for their beneficiaries. This year Crystal paid $5,550 in life insurance premiums. What amount of these payments can Crystal deduct? Crystal is on the cash method and calendar year.

2. Rock Island Corporation generated taxable income (before the domestic production activities deduction) of $21 million this year. The total income included $5,600,000 of qualified production activities income. The company paid $540,000 in W-2 wages to generate the qualified production activity income. What is Rock Island's domestic production activities deduction for the year?

3. Sandy Bottoms Corporation generated taxable income (before the domestic manufacturing deduction) of $3.09 million this year. The total income included $2,350,900 of qualified production activities income. The company paid $460,900 in W-2 wages to generate the qualified production activity income. What is Sandy Bottom's domestic manufacturing deduction for the year?

4. Mike operates a fishing outfitter as an accrual-method sole proprietorship. On March 1^st of this year Mike received $17,400 for five outfitting trips. This is the first time Mike agreed to such a payment and he is obligated to outfit one trip per year for the next five summers beginning this year. How much income must Mike recognize in each of the next five years if he is attempting to minimize his tax burden?