Under the Cash Method of Accounting, All of the Following

question 1342

Multiple Choice

Under the cash method of accounting, all of the following are true with the exception of

• A) income is reported in the tax year in which payments are actually or constructively received.
• B) gross income includes the value of property received.
• C) to some extent, a taxpayer may control the year in which an expense is deductible by choosing when to make the payment.
• D) fixed assets are always expensed as the taxpayer pays for the assets.

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Definitions:

Social Security Act

A 1935 US law establishing a system of federal old-age benefits, and providing for unemployment insurance, disability insurance, and survivors' insurance.

Retirement Age

The age at which a person is generally expected to retire from the workforce, often determined by government policy or employment contracts.

Exempt Amount

Refers to the portion of income that is not subject to tax or is exempt from standard calculations in various contexts.

Social Security Contributions

Payments made into a government system by employers, employees, or both, intended to fund retirement benefits and other social welfare programs.