Which of the following is incorrect?
A) All salaries of a business are deductible.
B) To be deductible, a business expense must be both ordinary and necessary.
C) The income and expenses of a sole proprietorship business are reported on Schedule C.
D) The purchase of a building must be capitalized.
E) All of the above are incorrect.

Question

Quizplus · Accepted Answer

Not all salaries of a business are necessarily deductible. Salaries must be reasonable and directly related to the business in order to be deductible. Some salaries, such as those paid to family members who do not perform significant services for the business, may not be deductible.

Which of the Following Is Incorrect