Bart Owns 100% of the Stock of Octo Corporation,which Uses

question 56

Multiple Choice

Bart owns 100% of the stock of Octo Corporation,which uses the accrual method.Bart's sister Samantha,a cash method taxpayer,did some advertising work for Octo in November 2015.In December,Octo received a billing statement from Samantha for $5,000 and paid Samantha the $5,000 in January 2016.Samantha is a calendar year taxpayer.When may Octo deduct the $5,000?

• A)2015
• B)2016
• C)Either 2015 or 2016
• D)The expense is not deductible since Samantha is Bart's sister.

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Definitions:

Quantity Demanded

The complete volume of a particular good or service that purchasers are both eager and financially able to acquire at a certain price within a market.

Price Increases

Situations where the cost of goods or services rise, often reflecting inflation or increased production costs.

Cancer-Causing Particles

Substances or elements that, upon exposure, increase the risk of developing cancer in living tissues.

Plastic Containers

Durable and versatile containers made from plastic materials used for storing, packaging, or transporting goods.