Noel operates his own business in Beenleigh as a sole practitioner lawyer. He has four employees. Noel's business had the following expenses during the current income tax year.

• A large bookcase needed to store law reports containing decided cases costing $3,600 paid for on 1 November of the current income tax year. The effective life of the bookcase is 10 years;
• Professional indemnity insurance premium (for one year) of $3,500 paid on 1 January of the current income tax year.
• Wages of $200,000 for the four employees;
• Provision for annual leave of $80,000;
• Reimbursement of HECS fees of $2,300 for one of his employees.Noel is liable to pay Fringe Benefits Tax on the reimbursed HECS fees.
• An individual debtors balance of $1,000 that Noel anticipates will eventually become a bad debt. Noel has not written off the debt as bad in the current income year.

In relation to Noels business, which of the following statements ismost correct?

Noel is entitled to claim a deduction for the bookcase under section 8-1 ITAA 1997 for the current income tax year.

Noel is not entitled to claim a deduction in respect of the professional indemnity insurance premium as it does not have a connection to deriving business income.

Noel is not entitled to claim a deduction for the provision for annual leave as it does meet the requirements outlined in section 26-10 ITAA1997.

Noel is not able to claim a deduction in respect of the HECS fees.

Noel can claim a deduction for the$1,000bad debt under section25-35ITAA97.