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Mrs Pike's 2012 Compensation from Her Corporate Employer Consisted of $325,000

Question 87

Multiple Choice

Mrs. Pike's 2012 compensation from her corporate employer consisted of $325,000 current salary and $75,000 unfunded deferred compensation payable upon her retirement in 2017. Which of the following statements is true?


A) In 2012, Mrs. Pike must include $400,000 in gross income, and her employer is allowed a $400,000 deduction.
B) In 2012, Mrs. Pike must include $325,000 in gross income, and her employer is allowed a $400,000 deduction.
C) In 2012, Mrs. Pike must include $400,000 in gross income, and her employer is allowed a $325,000 deduction.
D) In 2012, Mrs. Pike must include $325,000 in gross income, and her employer is allowed a $325,000 deduction.

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