Which of the Following Types of Interest Are Not Likely

question 71

Multiple Choice

Which of the following types of interest are not likely to be deductible in 2017?

• A)Interest on personal credit cards
• B)Interest on a $40,000 home equity line used to buy a car
• C)Interest on a $150,000 mortgage on a principle residence
• D)Interest on a $90,000 home equity line used to pay college tuition
• E)All of the above are likely to be deductible

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Definitions:

Voluntary Deductions

Amounts that employees choose to have withheld from their gross pay for various benefits or contributions, such as insurance premiums, retirement contributions, and union dues.

Accrued Vacation Benefits

The amount of vacation time that employees have earned but not yet taken, which is recorded as a liability on the company's books.

Vacation Benefits Expense

The cost to the company for the vacation time entitled to employees, reflected in financial statements.

Year-End Adjusting Entry

Entries made in the accounting records at the conclusion of an accounting period to allocate income and expenditures to the period in which they actually occurred.