Jackey Company, a Calendar Year, Accrual Basis Taxpayer, Did Not

question 97

Multiple Choice

Jackey Company, a calendar year, accrual basis taxpayer, did not pay the $44,200 December rent on its commercial office space until January 8. As result, Jackey's accountant made a routine year-end accrual of $44,200 rent expense. Which of the following statements is true?

• A) Jackey can deduct the $44,200 accrued rent expense.
• B) Jackey can deduct the $44,200 expense in the year of payment.
• C) The accrued rent expense results in a permanent book/tax difference.
• D) The accrued rent expense results in a temporary book/tax difference.

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Definitions:

Generational Differences

Variations in attitudes, behaviors, expectations, and habits among individuals from different age groups, often causing misunderstandings or conflicts in the workplace.

Cultural Difference

The variety of behaviors, beliefs, values, and patterns that distinguish one society or group of people from another.

Workforce Expansion

The process of increasing the number of employees in an organization to meet production demands or business growth.

Diverse Backgrounds

The inclusion and representation of individuals from a wide range of cultural, ethnic, socioeconomic, and educational backgrounds.