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39) Which of the following tax credits is fully refundable? a) American opportunity credit b) Dependent care credit c) Earned income credit. d) None of the choices are correct 40) Which of the following is likely to be a fully deductible business expense? a) Salaries in excess of the industry average paid to attract talented employees b) The cost of employee uniforms that can be adapted to ordinary personal wear e) A speeding fine paid by a trucker who was delivering a rush order d) The cost of a three-year subscription to a business publication e) None of the choices are likely to be deductible. es a storage business on the accrual method. On July 1 Brad paid $48,000 for rent on his storage warehouse and $18,000 for the 12 months. What is Brad's deduction for the rent and insurance? insurance on the contents of the warchouse. The rent and insurance covers the next a) $48,000 for the rent and S18,000 for the insurance b) $24,000 for the rent and S18,000 for the insurance c) $24,000 for the rent and $9,000 for the insurance. d) $48,000 for the rent and $9,000 for the insurance. e) None of the choices are true. 42) Which of the following is an explanation for why insurance premiums on a key employee are not deductible? a) A deduction for the insurance premium would offset taxable income without the potential for the proceeds generating taxable income. b) The federal government does not want to subsidize insurance companies c) It is impractical to trace insurance premiums to the receipt of proceeds d) Congress presumes that all expenses are not deductible unless specifically allowed in the Internal Revenue Code. This rule was grandfathered from a time when the Internal Revenue Code disallowed all insura premiums deductions e) 43) Which of the following is a true statement? a) Meals, lodging, and incidental expenditures are only deductible if the taxpayer is away from overnight while traveling b) Meals are deductible for an employee who is forced to work during the lunch hour e) When a taxpayer travels solely for business purposes, only half of the costs of travel are deducti d) If travel has both business and personal aspects, the cost of transportation is always deductible deductibility of lodging depends upon whether business is conducted that day e) None of the choices are true. 44) Which of the following assets are eligible for 79 expensing? a) Used office machinery b) Qualified leasehold improvements c) A new delivery truck d) Used office furniture e) All of the choices are correet

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