Answered step by step
Verified Expert Solution
Link Copied!
Question
1 Approved Answer

Your company has a travel policy that reimburses employees for the ordinary and necessary costs of business travel. Employees often mix a business trip



image

Your company has a travel policy that reimburses employees for the "ordinary and necessary" costs of business travel. Employees often mix a business trip with pleasure by either extending the time at the destination or traveling from the business destination to a nearby resort or other personal destination. When this happens, an allocation must be made between the business and personal portions of the trip. However, the travel policy is unclear on the allocation method to follow. Consider this example. An employee obtained a business-class ticket for $9,368 and traveled the following Itinerary. One-Way Regular From Chicago To Paris Miles 4,060 Fare $3,590 Purpose Business Paris Rio de Janeiro Rio de Janeiro Chicago 5,640 4,480 Personal 5,290 3,400 Return On the date of the flights between Chicago and Paris (and return), a restricted round-trip fare of $4,820 was available. Required: a. Compute the business portion of the airfare according to each of the following independent scenarios: 1. Based on the maximum reimbursement for the employee. 2. Based on the minimum cost to the company. 1. Business portion of the airfare 2. Business portion of the airfare

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Certainly based on the image you sent the business portion of the airfare can be computed in two ways Maximum reimbursement for the employee In this scenario the employee would be reimbursed for the f... blur-text-image
Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial and Managerial Accounting

Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren

11th Edition

9780538480901, 9781111525774, 538480890, 538480904, 1111525773, 978-0538480895

More Books

Students also viewed these Accounting questions

Question

discuss the models practical implications for job (re)design.

Answered: 1 week ago