Question

Exercise 10-19 (Algorithmic) (LO. 4)
Candlewood LLC started business on March 1, and it adopted a calendar tax year. During the year, Candlewood Incurre
fees for drafting the LLC's operating agreement and $7,425 in accoun
$22,275 of organizational costs. Candlewood also incurred $12,900 of pre
costs for new employees before opening for business, for a tota
available for these costs.

es for tax advice of an organizational nature, for a total of
f salaries and training
artup costs. The LLC wants to take the largest deduction

If required, round any division to six de
nearest dollar.
How much can Candlewood deduct as org
The LLC may deduct $

Answer 1

Answer:

Transcribed image text: Exercise 10-19 (Algorithmic) (LO. 4) Candlewood LLC started business on December 1, and it adopted a calendar tax year. During the year, Candlewood incurred $7,100 in legal fees for drafting the LLC's operating agreement and $3,550 in accounting fees for tax advice of an organizational nature, for a total of $10,650 of organizational costs. Candlewood also incurred $12,900 of preopening advertising expenses and $38,100 of salaries and training costs for new employees before opening for business, for a total of $51,000 of startup costs. The LLC wants to take the largest deduction available for these costs. If required, round any division to six decimal places and use in subsequent computations. Round your final answers to the nearest dollar. The LLC may deduct $ x as organizational expenses and $ x as startup expenses.