Bart Owns 100% of the Stock of Octo Corporation,which Uses

question 54

Multiple Choice

Bart owns 100% of the stock of Octo Corporation,which uses the accrual method.Bart's sister Samantha,a cash-method taxpayer,did some advertising work for Octo in November 2017.In December,Octo received a billing statement from Samantha for $5,000 and paid Samantha the $5,000 in January 2018.Samantha is a calendar-year taxpayer.When may Octo deduct the $5,000?

• A)2017
• B)2018
• C)Either 2017 or 2018
• D)The expense is not deductible since Samantha is Bart's sister.

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