Fayette Corporation incorporates on January 7, begins business on July 10, and elects to have its initial tax year end on September 30. Fayette incurs the following expenses between January and September related to its organization during the current year: E (Click on the icon to view list of expenses.) Read the requirements. Requirement a. What alternative treatments are available for Fayette's expenditures? Select the tax treatment for each expenditure. Begin with the expenditures incurred through June 1. Then, complete the table for the expenditures through July 15. Date Amount Treatment January 30 May 15 Expenditure Travel to investigate potential business site Legal expenses to draft corporate charter Commissions to stockbroker for issuing and selling stock May 30 May 30 Temporary directors' fees June 1 2,500 Start-up expense 6,500 Organizational expense 1,000 Reduction of capital 240 Organizational expense 7,000 Capitalized to the related asset 1,500 Organizational expense 7,500 Start-up expense 1,300 Start-up expense 1,300 Sec. 162 expense Expense of transferring building to Fayette Accounting fees to set up corporate books Training expenses for employees Rent expense for June June 5 June 10 June 15 July 15 Rent expense for July and amortize the remainder Fayette Corporation can elect to deduct of organizational expenditures under over months. This election is deemed automatic under Treasury Regulations. Fayette Corporation incorporates on January 7, begins business on July 10, and elects to have its initial tax year end on September 30. Fayette incurs the following expenses between January and September related to its organization during the current year: E (Click on the icon to view list of expenses.) Read the requirements. Requirement a. What alternative treatments are available for Fayette's expenditures? Select the tax treatment for each expenditure. Begin with the expenditures incurred through June 1. Then, complete the table for the expenditures through July 15. Date Amount Treatment January 30 May 15 Expenditure Travel to investigate potential business site Legal expenses to draft corporate charter Commissions to stockbroker for issuing and selling stock May 30 May 30 Temporary directors' fees June 1 2,500 Start-up expense 6,500 Organizational expense 1,000 Reduction of capital 240 Organizational expense 7,000 Capitalized to the related asset 1,500 Organizational expense 7,500 Start-up expense 1,300 Start-up expense 1,300 Sec. 162 expense Expense of transferring building to Fayette Accounting fees to set up corporate books Training expenses for employees Rent expense for June June 5 June 10 June 15 July 15 Rent expense for July and amortize the remainder Fayette Corporation can elect to deduct of organizational expenditures under over months. This election is deemed automatic under Treasury Regulations