Troy incurs the following expenses in his business, an illegal gambling establishment: $$\begin{array} { | l | r | }
\hline \text { Salaries to employees } & \$ 200,000 \
\hline \text { Insurance expense } & 60,000 \
\hline \text { Utilities expense } & 70,000 \
\hline \text { Bribes to police } & 50,000 \
\hline
\end{array}$$ His deductible expenses are

Question

Troy incurs the following expenses in his business, an illegal gambling establishment: $$\begin{array} { | l | r | } 
\hline \text { Salaries to employees } & \$ 200,000 \
\hline \text { Insurance expense } & 60,000 \
\hline \text { Utilities expense } & 70,000 \
\hline \text { Bribes to police } & 50,000 \
\hline
\end{array}$$ His deductible expenses are

Quizplus · Accepted Answer

In the U.S., expenses related to illegal activities are generally not deductible. However, ordinary and necessary expenses like salaries, insurance, and utilities can be deductible, totaling $330,000. Bribes are not deductible.

Troy Incurs the Following Expenses in His Business, an Illegal