Liquidating Expenses Are Generally Deducted as Ordinary and Necessary Business

question 52

True/False

Liquidating expenses are generally deducted as ordinary and necessary business expenses.

---

Definitions:

Fixed Costs

Costs that do not vary with the level of production or sales, including expenses like rent and salaries.

Variable Costs

Costs that vary directly with the level of production or output, such as raw materials and labor expenses.

Exponentiation

A mathematical operation involving two numbers, the base and the exponent, indicating how many times the base is multiplied by itself.

Principle Amount

The original sum of money borrowed in a loan or put into an investment.