Which of the following statements is false? Group of answer choices A.Prepaid expenses are fully deductible when paid for a cash basis taxpayer. B.Reasonableness is most often considered in the context of compensation. C.Inventory can not be deducted when paid. D.You are considered to have paid at the date you pay with a credit card, even though you still owe the bank

Which of the following statements is false? Group of answer choices A.Prepaid expenses are fully deductible when paid for a cash basis taxpayer. B.Reasonableness is most often considered in the context of compensation. C.Inventory can not be deducted when paid. D.You are considered to have paid at the date you pay with a credit card, even though you still owe the bank

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter6: Deductions And Losses: In General

Section: Chapter Questions

Problem 10DQ

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Similar questions

The definition of gross income in the tax law is: All items specifically listed as income in the tax law All cash payments received for goods provided and services performed All income from whatever source derived All income from whatever source derived unless the income is earned illegally
Which of the following statements is false? A.Prepaid expenses are fully deductible when paid for a cash basis taxpayer. B.Reasonableness is most often considered in the context of compensation. C.Inventory can not be deducted when paid. D.You are considered to have paid at the date you pay with a credit card, even though you still owe the bank.
Which of the following statements is false? In order to claim a bad debt deduction: a. There must be an existing debt. b. The debt must be written-off. c. The taxpayer must be in the business of money-lending. d. The debt must be bad.
f a business owner paid for the business expenses with their personal account, and those expenses would otherwise be deductible, they: A. CANNOT be deducted on the tax return because they weren't paid for from a business account. B. CAN be included on the tax return as long as proof of the expenses is sent with the return. C. CAN be deducted on the tax return. D. CANNOT be deducted because the IRS requires separate business and personal bank accounts.
The constructive receipt doctrine requires that income be recognized when it is made available to the cash basis taxpayer even though there are restrictions on actually receiving it. The constructive receipt doctrine does not apply to accrual basis taxpayers. True False
-Which of the following should not be claimed as deductions from gross income? * interest payment on loans for the purchase of machinery and equipment used inbusiness. salaries and bonuses paid to employees. discounts given to senior citizens on certain goods and services. advertising expense to maintain some form of goodwill for the taxpayer’s business.
1. Indicate whether the following expenditures are trade or business deductions (T), production of income deductions (PI), personal deductions (P), or are not deductible (X). Also indicate if the deductible expenditures are deductible “for” or “from” AGI. a. Interest expense on business loan b. Expenses incurred in an activity lacking a true profit motive (i.e., a hobby activity) c. Commuting expenses of individual taxpayer d. Rent payments paid by an illegal gambling business e. Payment by a business to bribe a government official