To Be Tax Deductible by an Accrual-Basis Taxpayer,an Expense Must

question 32

Multiple Choice

To be tax deductible by an accrual-basis taxpayer,an expense must be all of the following except

• A)ordinary and necessary.
• B)paid in cash.
• C)reasonable in amount.
• D)an expense of the taxpayer.

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Definitions:

Trade-Off

A situational decision that involves diminishing or losing one quality, quantity, or property of a set or design in return for gains in other aspects.

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A popular dish of Italian origin, consisting of a flatbread typically topped with tomato sauce, cheese, and various other ingredients, then baked.

Production Possibilities Frontier

A graphical depiction that shows the maximum quantity of one good that can be produced for every possible quantity of another good, given the available resources and technology.