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

question 139

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 2016.In December,Octo received a billing statement from Samantha for $5,000 and paid Samantha the $5,000 in January 2017.Samantha is a calendar year taxpayer.When may Octo deduct the $5,000?

• A)2016
• B)2017
• C)Either 2016 or 2017
• D)The expense is not deductible since Samantha is Bart's sister.

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Definitions:

Identical Twins

Twins who develop from a single fertilized egg that splits into two, sharing 100% of their DNA, making them genetically identical.

Psychotic

Relating to psychosis, a mental disorder characterized by a disconnection from reality, often manifesting as hallucinations or delusions.

Psychosis

A mental health condition characterized by a disconnection from reality, which can include hallucinations, delusions, and impaired thinking.

Amphetamines

Stimulant drugs that increase central nervous system activity, used therapeutically and recreationally.