Boris and Natasha are independent people who do not know one another. By coincidence, each is planning
Question:
Boris and Natasha are independent people who do not know one another. By coincidence, each is planning to start a new retail business that sells Italian-made shoes. Boris has never owned or operated such a store before. Natasha, in contrast, has owned and operated a leather goods store that sold purses made in Italy, but not shoes.
Boris and Natasha, acting separately, each flew to Milan, Italy to explore the possibility of getting high-quality leather shoes at low wholesale prices. While in Italy, Boris and Natasha were adversely affected the new quarantine on international travel back to the United States. Accordingly, each incurred budgeted costs of $5,000 and an additional $4,000 of hotel fees necessitated by them unexpectedly having to stay in Italy longer due to the quarantine.
Ultimately, due to the unexpected downturn in the economy triggered by the corona virus, each of them independently has decided to NOT open such a retail store.
What amount, if any, may each of them deduct during 2020 as business expenses?
Global Marketing management
ISBN: 978-0470505748
5th edition
Authors: Masaaki Kotabe, Kristiaan Helsen