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Penny, a full-time biochemist, loves stock car racing. To feed her passion, she bought a...

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Accounting

Penny, a full-time biochemist, loves stock car racing. To feed her passion, she bought a used dirt-track car and has started entering some local dirt-track races. The prize money is pretty small ($1,000 for the winner), but she really is not in it for the money. Penny reported the following income and expenses from her nights at the track:

Prize money $2,700
Expenses:
Transportation from her home to the races 1,740
Depreciation on the dirt-track car 5,640
Entry fees 6,000
Oil, gas, supplies, repairs for the dirt-track car 2,860

Calculate Pennys deduction for the racing expenses assuming that the racing activity is a hobby, and Pennys AGI is $98,100 before considering the prize money.

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