Determine whether the taxpayer in each of the following situations has a claim of right to the…

Determine whether the taxpayer in each of the following
situations has a claim of right to the income received:

a. Trigger, Inc., receives a $5,000 stud fee for services
rendered by one of its prized horses. Under its standard contract, Trigger will
return the fee if a live foal is not born.

b. Orville works as a salesman for Brewster Company. He
receives a travel allowance of $1,000 at the beginning of each quarter. At the
end of each quarter, he must make a full accounting of his travel expenses and
reimburse Brewster for any of the $1,000 not spent on approved travel.

c. Assume that
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Determine whether the taxpayer in each of the following
situations has a claim of right to the income received:

a. Trigger, Inc., receives a $5,000 stud fee for services
rendered by one of its prized horses. Under its standard contract, Trigger will
return the fee if a live foal is not born.

b. Orville works as a salesman for Brewster Company. He
receives a travel allowance of $1,000 at the beginning of each quarter. At the
end of each quarter, he must make a full accounting of his travel expenses and
reimburse Brewster for any of the $1,000 not spent on approved travel.

c. Assume that in part b, Orville is not required to account
for his actual travel expenses for Brewster and is not required to return
unused portions of the travel advance.

d. Arco Architecture, Inc., receives $10,000 from a client
for work done by a subcontractor on the client’s project. Arco, in turn, pays
$10,000 to the subcontractor.

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