Expenses Paid with a Credit Card Are Deductible at the Time

question 64

True/False

Expenses paid with a credit card are deductible at the time a cash-basis taxpayer pays for the charge.

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Definitions:

Fixed Expenses

Costs that do not change with the level of production or sales activities within a certain range or period.

Variable Expenses

Costs that change in proportion to the level of activity within a business.

Contribution Margin

The amount by which the sales revenue of a product exceeds its variable costs, indicating how much contributes towards covering fixed costs and generating profit.

Break-Even Point

The point at which total costs and total revenues are equal, resulting in no net gain or loss for the business.