On December 19, 2018, Logo Inc., an accrual basis corporation, accrued $50,000 compensation expense for a routine year-end bonus payable to Mr Craig, who is Logo's CFO. Logo paid the $50,000 to Mr Craig on April 25, 2019. Which of the following statements is true?
A) If Mr. Craig and Logo are not related parties, Logo can deduct the accrued expense in 2018.
B) If Mr. Craig and Logo are related parties, Mr. Craig must include his $50,000 bonus in 2018 gross income.
C) Regardless of whether Logo and Mr. Craig are related parties, Logo can't deduct the accrued compensation expense in 2018.
D) If Mr. Craig and Logo are not related parties, Mr. Craig can elect to include the $50,000 bonus in gross income in either 2018 or 2019.
Correct Answer:
Verified
Q66: Which of the following statements concerning the
Q70: Which of the following businesses is prohibited
Q74: Addis Company operates a large retail men's
Q74: Which of the following does not result
Q77: Which of the following does not result
Q82: On December 19, 2018, Acme Inc., an
Q83: Bendom Inc, a calendar year, accrual basis
Q85: Mr John Carre owns 67% of the
Q88: Timm Inc., a calendar year, accrual basis
Q90: Hitz Company, a calendar year, accrual basis
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents