Delta Corporation incorporates on January 7, begins business on July 10, and elects to have its initial tax year end on October 31. Delta incurs the following expenses between January and October related to its organization during the current year:

a. What alternative treatments are available for Delta€™s expenditures?
b. What amount of organizational expenditures can Delta Corporation deduct on its first tax return for the fiscal year ending October 31?
c. What amount of start-up costs can Delta Corporation deduct on its first tax return?

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Date Expenditure Travel to investigate potential business site Legal expenses to draft corporate charter Commissions to stockbroker for issuing and selling stock 4,000 Temporary directors fees Expense of transferring building to Delta Accounting fees to set up corporate books Training expenses for employees Rent expense for June Rent expense for July Amount January 30 May 15 May 30 May 30 S2,000 2,500 2,500 June 1 3,000 une 1,500 June 10 5,000 June 15 1,000 July 15 1,000