Identify Which of the Following Statements Is True

question 55

Multiple Choice

Identify which of the following statements is true.

• A)A corporation that accrues compensation payable to an employee must pay the amount within two and one-half months after the close of the taxable year to deduct the amount in the year of the accrual.
• B)Accrued compensation that is deductible in the year of accrual is considered to be part of an IRS deferred compensation plan.
• C)Accrued compensation not paid within three and one-half months after the close of the corporation tax year is deducted in the year following the accrual.
• D)All of the above are false.

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Definitions:

Wealth

The abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions.

Interest Rate

The proportion, typically expressed as a percentage, that is charged for the use of borrowed money or paid on deposited funds.

Processing Fee

A charge assessed for the processing of a transaction or service, often seen in financial services, applications, and loans.

Bonus

An additional amount of money given to an employee on top of their regular salary, often as a reward for good performance or as part of a special agreement.