Chicagoland Landscape Company, a newly organized corporation, received a bill from its lawyers for $10,000 for time spent in organizing the company.
1. How should these costs be treated in the company's accounting records? Why?
2. How should they be treated for federal income tax purposes?

Question

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The Answer of Chicagoland Landscape Company, a newly organized corporation, received a bill from its lawyers for $10,000 for time spent in organizing the company.
1. How should these costs be treated in the company's accounting records? Why?
2. How should they be treated for federal income tax purposes?

Chicagoland Landscape Company, a Newly Organized Corporation, Received a Bill