Which of the Following Expenditures Are Not Deductible Because They

question 79

Multiple Choice

Which of the following expenditures are not deductible because they are personal in nature?
I.Premiums paid on liability insurance for the taxpayer.
II.Education costs that improves the taxpayer's skills in his/her trade or business.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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Definitions:

Statement of Stockholders' Equity

A financial document showing changes in the value of a company’s equity over a specific period, including shares issued, dividends paid, and earnings retained.

Retained Earnings

The residual net income available to a business after distributing dividends to its shareholders.

Net Income

Net income is the total profit of a company after all expenses, taxes, and costs have been subtracted from total revenues.

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.