Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Requlred Information [ The following information applies to the questions displayed below. ] Brooke owns a sole proprietorship in which she works as a management

Requlred Information
[The following information applies to the questions displayed below.]
Brooke owns a sole proprietorship in which she works as a management consultant. She maintains an office in her home
where she meets with clients, prepares bills, and performs other work-related tasks. The home office is 300 square feet,
and the entire house is 4,500 square feet. Brooke incurred the following home-related expenses during the year. Brooke
itemizes her deductions, and her itemized deduction for non-home business taxes is less than $10,000 by more than the
real property taxes allocated to business use of the home. Unless indicated otherwise, assume Brooke uses the actual
expense method to compute home office expenses.
Required:
a. What amount of each of these expenses is allocated to the home office?
b. What are the total amounts of tier 1, tier 2, and tier 3 expenses, respectively, allocated to the home office?
c. If Brooke reported $2,420 of Schedule C net income before the home office expense deduction, what is the amount of her home
office expense deduction, and what home office expenses, if any. would she carry over to next year?
e. Assume that Brooke uses the simplified method for computing home office expenses. If Brooke reported $2,420 of Schedule C
net income before the home office expense deduction, what is the amount of her home office expense deduction and what home
office expenses, if any, would she carry over to next year?
Note: Leave no answer blank. Enter zero If applicable.
Answer is complete but not entirely correct.
Complete this question by entering your answers in the tabs below.
Required A
If Brooke reported $2420 of Schedule C net income before the home office expense deduction, what is the amount of her
home office expense deduction, and what home office expenses, if any, would she carry over to next year?
Note: Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations. Round your final answers to
the nearest whole dollar amount.
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions