1. PAZ Corporation incurred the following expenses during the year:

Federal (EPA) fine paid for violation of air quality laws....$50,000

Brides paid to foreign officials to approve foreign construction project.....$200,000

Kickbacks paid to local police....$25,000

Legal Fees incurred in contesting EPA Fine....$250,000

Court Costs incurred in contesting EPA Fine...$1,000

What is the amount of expenses that PAZ Corporation can deduct for the tax year?

2. QT Corporation incurred the following politically related expenses:

Payments to state lobbyists to secure passage of favorable legislation...$550,000

Political Contributions...$250,000

Political Dinner (Table Purchased)....$10,000

Expenses incurred by QT President to appear before local county board to discuss proposed legislation that will affect QT....$2,000

What is the amount of expense that QT Corporation can deduct for tax purposes?

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