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:
- Expenses Date Amount
- Attorney fees for articles of incorp. Feb 10 $38,000
- March 1-March 30 wages March 30 $3,800
- March 1-March 30 rent March 30 $1,900
- Stock issuance cost April 1 $21,000
- April 1-May 30 wages May 30 $9,500
A. What is the total amount of the start-up costs and organizational expenditures for Nicole's corporation?
- Total amount of the start-up cost $
- Organizational expenditures $
B. What amount of the start-up costs and organizational expenditures may the corporation immediately expense in year 1?
- Total amount of the start-up cost $
- Organizational expenditures $
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)?
- Start-up costs amortized $
- Organizational expenditures amortized$
D. What would be the allowable organizational expenditures, including immediate expensing and amortization, if Ingrid started a sole proprietorship instead?
- Allowable organizational expenditure?