Which of the Following Is a True Statement

question 33

Multiple Choice

Which of the following is a true statement?

• A) Meals are never deductible as a business expense.
• B) An employer can only deduct half of any meals provided to employees.
• C) The cost of business meals must be reasonable.
• D) A taxpayer can only deduct a meal for a client if business is discussed during the meal.
• E) None of these is true.

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Definitions:

Agency Relationship

A legal arrangement in which one party (the agent) acts on behalf of another (the principal) in dealings with third parties.

Fulfillment

The process of completing or carrying out a task, order, or obligation to its final conclusion.

Revocation

The act of recall or annulment of a decision or an offer that had been previously made.

Apparent Agency

A situation where a principal inadvertently leads a third party to reasonably believe that another individual has the authority to act as their agent, even if no such agency relationship actually exists.