Brown Corp., a calendar-year taxpayer, was organized and actively began operations on July 1, 2015, and incurred the following costs:
Legal fees to obtain corporate charter: $40,000
Commission paid to underwriter: $25,000
Temporary directors' meetings: $15,000
State incorporation fees: $4,400
For 2015, what amount should Brown Corp. deduct for organizational expenses?
a. $1,980
b. $2,814
c. $5,940
d. $6,812
Answer: A
CPA Exam
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