Sanchez Company Allows Its Employees to Make Personal Copies Without

question 71

Multiple Choice

Sanchez Company allows its employees to make personal copies without charge on the company copy machines. What concept, construct, or doctrine helps explain why the benefit received is not taxable to Sanchez employees?

• A)Administrative Convenience Concept.
• B)Assignment of Income Doctrine.
• C)Arms-length Transaction Concept.
• D)Ability To Pay Concept.
• E)Pay As You Go Concept.

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Definitions:

Capital Fund

A financial reserve or source of funds that an organization or government allocates for specific purposes, such as development or investment projects.

Useful Life

The estimated time period that an asset is expected to be usable by an entity, with reasonable efficiency, for the purpose for which it was acquired.

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity, which typically includes the balance sheet, income statement, and cash flow statement.

Not-for-profit Organizations

Entities that operate for purposes other than generating profit, focusing instead on public or social objectives.