Generally, Deductions for Additions to Reserves for Estimated Future Costs

question 60

Multiple Choice

Generally, deductions for additions to reserves for estimated future costs (e.g., an allowance for estimated warranty costs) are not allowed for Federal income tax purposes because allowing the deduction would:

• A)Result in a mismatching of revenues and expenses.
• B)Violate established public policy.
• C)Violate the economic performance requirement.
• D)Violate the tax benefit rule.
• E)None of the above.

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Definitions:

Peremptory Challenges

In the course of picking a jury, lawyers have the authority to turn down a predetermined number of potential jurors, no explanation required.

Challenges for Cause

A method during jury selection that allows attorneys to exclude a potential juror for a specific, articulated reason suggesting that the juror is incapable of delivering an impartial verdict.

Certified Class

In a legal context, a group of individuals certified by a court to act collectively in a class action lawsuit.

Class Action Lawsuit

A legal action filed by one or more plaintiffs on behalf of a larger group who are affected by the same issue, seeking collective compensation or remedy.