Question
Henry operates an illegal drug-running business and has the following items of income and expense. What is Henrys net income for tax purposes from this
Henry operates an illegal drug-running business and has the following items of income and expense. What is Henrys net income for tax purposes from this operation?
Income $800,000
Expenses:
Cost of goods sold
300,000
Rent
24,000
Utilities
9,000
Bribes to police
55,000
Insurance expense
5,000
Legal fees
25,000
Depreciation
30,000
Illegal kickbacks
30,000
(b) What is Henrys net income for tax purposes from this operation if it is a legal business?
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Business Accounting An Introduction To Financial And Management Accounting
Authors: Jill Collis, Roger Hussey, Andrew Holt, Holt Collis, J. Collis
2nd Edition
0230276237, 978-0230276239
