Henry entertains several of his key clients on January 1 of the current year.Expenses paid by Henry are as follows: Presuming proper substantiation,Henry's deduction is:

Question

Henry entertains several of his key clients on January 1 of the current year.Expenses paid by Henry are as follows:  Presuming proper substantiation,Henry's deduction is:

Quizplus · Accepted Answer

The deduction for entertainment expenses is limited to 50% of the actual cost incurred. In this case, the total cost incurred by Henry is $1,280 ($400 + $480 + $400). However, 50% of this amount is not deductible. Therefore, the deductible amount is $640.

Henry Entertains Several of His Key Clients on January 1