RollerQueens Inc

question 1878

Multiple Choice

RollerQueens Inc., a calendar- year accrual method taxpayer, enters into a contract each September with a cleaning service to clean the arena after each game during the team's October through March season. Under the criteria of the economic performance test, the RollerQueens Inc.'s deduction for cleaning expense

• A) is not allowed until payment is made.
• B) must be amortized over the contract period.
• C) is not allowed until the cleaning service contract is fully satisfied in the following year.
• D) is allowed in full in the year RollerQueens Inc. and the cleaning service enter into the contract.

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Definitions:

At-Will Employment

A employment arrangement where either the employer or the employee can terminate the relationship at any time without cause.

Employment-At-Will

A legal doctrine in some jurisdictions that enables an employment relationship to be terminated by either the employer or the employee for any reason that is not illegal.

Illegal Activity

Actions or behaviors that are prohibited by law and subject to criminal penalties or civil liability.

Good Cause

A legally valid reason or justification for an action, often pertaining to decisions in employment or legal proceedings.