On December 31,2010,Peregrine Corporation,an Accrual Method,calendar Year Taxpayer,accrued a Performance

question 76

Multiple Choice

On December 31,2010,Peregrine Corporation,an accrual method,calendar year taxpayer,accrued a performance bonus of $100,000 to Charles,a cash basis,calendar year taxpayer.Charles is president and sole shareholder of the corporation.When can Peregrine deduct the bonus?

• A)In 2010,if the bonus was authorized by the Board of Directors and payment was made on or before March 15,2011.
• B)In 2010,if payment was made on or before March 15,2011.
• C)In 2011,if payment was made at any time during that year.
• D)In 2011,but only if payment was made on or before March 15,2011.
• E)None of the above.

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