71) Carl is a self-employed real estate agent. For the current year, his self-employment net earnings (revenues minus expenses) are $80,000. He is also employed as an accountant with a gross salary of $70,000 for the year. Assume that the appropriate social security income ceiling for the year is $130,000 and that the self-employed FICA rates are 12.4% for social security and 2.9% for Medicare. What is Carl s self-employment tax liability for the year?

a. $9,583

b. $10,901

c. $11,304

d. $12,240

72) Accrual basis taxpayers may deduct estimated warranty expenses based on a percentage of product sales made during the year that are subject to the warranty. TRUE or FALSE