Sole Proprietors Are Allowed to Deduct Owner-Employee Salaries and Fringe

question 46

True/False

Sole proprietors are allowed to deduct owner-employee salaries and fringe benefits.

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Definitions:

Producer Surplus

The difference between the amount producers are willing to accept for a good versus what they actually receive.

Marginal Benefit

Marginal benefit is the additional satisfaction or utility received by consuming one more unit of a good or service.

Marginal Cost

The cost attached to the production of one additional unit of a good or service.

Competitive Market

A competitive market is one where there are many buyers and sellers so that no single buyer or seller can influence the price or terms of products.