McGraw-Hill's Taxation of Business Entities 3rd Edition by Connie Weaver, Brian Spilker, Edmund Outslay, John Robinson, Ronald Worsham, Benjamin Ayers, John Barrick

Exercise 45

Matt has contracted with Apex Services to provide routine repair and maintenance services for several pieces of his business equipment. On November 1, of year 0, Matt paid $2,000 for the repairs that he expects will begin in early March of year 1.
a. What amount of the cost of the repairs can Matt deduct in year 0 if he uses the cash method of accounting for his business
b. What amount of the cost of the repairs can Matt deduct in year 0 if he uses the accrual method of accounting for his business
c. What amount of the cost of the repairs can Matt deduct in year 0 if he uses the accrual method and he expects the repairs to be done by early February
d. What amount of the cost of the repairs can Matt deduct in year 0 if he uses the cash method of accounting and he expects the repairs to be done by early February