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Indicate the amount (if any) that Josh can deduct as ordinary and necessary business deductions in each of the following situations. (Leave no answers blank. Enter zero if applicable.)
a.Josh borrowed $80,000 from the First State Bank using his business assets as collateral. He used the money to buy City of Blanksville bonds. Over the course of a year, Josh paid interest of $8,200 on the borrowed funds, but he received $4,500 of interest on the bonds.
b.Josh purchased a piece of land for $58,500 in order to get a location to expand his business. He also paid $8,900 to construct a new driveway for access to the property.
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