Assume the same facts as in Problem I:6-40, except that Big Bang LLC incurs $41,000 in expenses,

Question:

Assume the same facts as in Problem I:6-40, except that Big Bang LLC incurs $41,000 in expenses, it does not already own the other entertainment galleries and it does not own anything similar.
a. What is the proper tax treatment of these expenses if Big Bang does not open the new gallery?
b. What is the proper tax treatment of these expenses if Big Bang decides to open the new gallery on May 1 of the current year and makes the appropriate election under Sec. 195?