Match Each Statement with the Correct Term Below

question 8

Multiple Choice

Match each statement with the correct term below.
-All-events Test

• A)Specifically disallowed.
• B)Appropriate and helpful.
• C)Considered a trade or business.
• D)Not considered a trade or business.
• E)Problems with this generally arise with related parties.
• F)This is met when services or property are provided to the taxpayer.
• G)Normal, common, and accepted but not necessarily regularly recurring.
• H)This is met when the existence and the amount of a liability have been established.

---

Definitions:

Cash Basis Accounting

An accounting method that records revenues and expenses when cash is actually received or paid, rather than at the time they are incurred.

Rental Payments

Periodic payments made by a lessee to a lessor for the use of a property, space, or equipment.

Landlord

An individual or entity that owns real estate which is rented or leased to another party, known as a tenant.

Prepaid Expense

Costs that have been paid in advance for goods or services to be received in the future, recognized as assets on the balance sheet until consumed.