Taxpayers Are Generally Allowed to Claim Deductions for Expenditures Unless

question 94

True/False

Taxpayers are generally allowed to claim deductions for expenditures unless a specific tax provision indicates the expenditure is not deductible.In contrast to the all-inclusive treatment of income,taxpayers are not allowed to deduct anything unless a specific tax provision allows them to do so.

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Definitions:

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, culminating in its net income or loss for that period.

Depreciable Asset

An asset that loses value over time due to use, wear and tear, or obsolescence, and whose cost can be allocated over its useful life.

Net Income

A company's remaining income after deducting all costs and taxes from its revenue.

Gain

The increase in the value of an asset or a decrease in the value of a liability, which results in an increase in the equity of a business.