PG LLC Is an Accrual Method Partnership,manufacturing Drones

question 60

True/False

PG LLC is an accrual method partnership,manufacturing drones.Patty,75% partner in PG and a cash method taxpayer,lends $100,000 to PG as a working capital loan on January 1,2019,with interest due at an arms-length rate.PG accrues,and reports on its income statement,$5,000 of interest expense on this loan.PG pays the interest due to Patty on January 2,2020.On PG LLC's 2019 tax return,it will deduct the $5,000 interest expense.

---

Definitions:

Lewis Terman

An American psychologist best known for his work on intelligence testing and the Stanford-Binet IQ test.

Intelligence Testing

The measurement and assessment of an individual's mental capacity and cognitive abilities through structured tests.

Academic Geniuses

Individuals demonstrating exceptional intellectual ability or creative productivity in educational settings, often contributing significantly to academic disciplines.

Mental Locks

Psychological barriers or fixed mindsets that prevent individuals from seeing solutions outside their perceived limitations.