Question
Nicole organized a new corporation. The corporation began business on April 1 of year 1. She made the following expenditures associated with getting the corporation
Nicole organized a new corporation. The corporation began business on April 1 of year 1. She made the following expenditures associated with getting the corporation started: |
Expense | Date | Amount | |
Attorney fees for articles of incorporation | February 10 | $ | 43,500 |
March 1 March 30 wages | March 30 | 7,450 | |
March 1 March 30 rent | March 30 | 3,150 | |
Stock issuance costs | April 1 | 18,000 | |
April 1 May 30 wages | May 30 | 18,625 | |
a. | What is the total amount of the start-up costs and organizational expenditures for Nicole's corporation? |
b. | What amount of the start-up costs and organizational expenditures may the corporation immediately expense in year 1? |
c. | What amount can the corporation deduct as amortization expense for the organizational expenditures and for the start-up costs for year 1 (not including the amount it immediately expensed)? (Round intermediate calculations to 2 decimal places and final answer to the nearest whole dollar amount.) |
d. | What would be the allowable organizational expenditures, including immediate expensing and amortization, if Nicole started a sole proprietorship instead? |
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