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49 of 50. As a sole proprietor, Roger reports his business income on Schedule C (Form 1040). He used 350 square feet of his 2,100-square-foot rented loft exclusively and regularly for business. Roger used the cash accounting method and had the following income and expenses for his financial planning business:

• Gross receipts: $34,850
• Expenses:
• Advertising: $85
• Business insurance: $785
• Business license: $150
• Comprehensive health insurance (entire year): $8,988
• Office supplies: $67
• Postage: $55
• Rent (entire year): $13,750
• Renter's insurance (entire year): $1,955
• Second phone line, exclusively for business: $200
• Tax preparation (allocated to business): $450
• Utilities (entire year): $3,510.

Roger closed his business on April 1, 2018. He had no carryover losses and all assets were fully depreciated. If Roger elects to use actual office-in-home (OIH) expenses, what is the amount of his deduction?

$147

$801

$2,633

$4,803

Dallas reorganized his office and purchased a new office desk for $1,600 on March 17, 2018. He wanted to depreciate the desk over a longer period of time, so he chose the Alternative Depreciation System (ADS) straight-line method and did not claim bonus depreciation. Using the half-year convention, compute his 2018 depreciation deduction.

$57

$80

$114

$160

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