-58 Classification and Deductibility. In each of the following independent situations dicate for the current taxable year the amounts deductible for AGI, from AGI, or nt deductible at all. Unless otherwise stated, assume all taxpayers use the cash hasie method of accounting and report using the calendar year. a. B sold stock to his mother for a $700 loss. B's mother subsequently sold the s tock for $400 less than she had paid to B b. Same as (a) but assume the mother sold the stock for $500 more than she had paid to B c. D operates three pizza restaurants as a sole proprietorship in Indianapolis. In July he paid $1,000 in air fares to travel to Chicago and Detroit to determine the feasibility of opening additional restaurants. Because of economic conditions, D decided not to open any additional restaurants d. T owns and operates several gun stores as a sole proprietorship. In light of gun control legislation, he traveled to the state capital at a cost of $80 to testify before a committee. In addition, he traveled around the state speaking at various Rotary and Kiwanis Club functions on the pending legislation at a cost of $475. T also placed an advertisement in the local newspaper concerning the merit of the leg islation at a cost of $50. He pays dues to the National Rifle Association of $100 e. D is employed as a ship captain for a leisure cruise company. He paid $1,000 for rent on a warehouse where he stores smuggled narcotics, which he sells illegally f. M, a plumber and an accrual basis taxpayer, warrants his work. This year he es timates that expenses attributable to the warranty work are about 3% of sales, or $3,000 g. G, a computer operator, pays $75 for a subscription to an investment newsletter devoted to investment opportunities in state and municipal bonds. 150