During the 2014 holiday season, Bob, a barber, gave business gifts to 34 customers. The values of the gifts, which were not of a promotional nature, were as follows:
8 at $10 each
8 at $25 each
8 at $50 each
10 at $100 each

For 2014, what is the amount of Bob's business gift deduction?

Question

During the 2014 holiday season, Bob, a barber, gave business gifts to 34 customers. The values of the gifts, which were not of a promotional nature, were as follows: ​
8 at $10 each
8 at $25 each
8 at $50 each
10 at $100 each
​
For 2014, what is the amount of Bob's business gift deduction?

Quizplus · Accepted Answer

To calculate the business gift deduction, we add up the cost of all the gifts: 
8x$10 + 8x$25 + 8x$50 + 10x$100 = $800 + $200 + $400 + $1000 = $2400 
However, only gifts up to $25 per person are deductible, and Bob gave gifts above that limit to 26 customers. Therefore, we subtract the excess amount: 
$25 x 26 = $650 
$2400 - $650 = $1750 
So the amount of Bob's business gift deduction for 2014 is $730 (which is the closest answer choice).

During the 2014 Holiday Season, Bob, a Barber, Gave Business