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EB Corporation, a calendar year, accrual method C corporation, has two cash methods, calendar year shareholders who are unrelated to each other. George owns 35% of the stock, and Nancy owns the remaining 65%. During 2023, EB Corporation paid a salary of $200K to each shareholder. On December 31, 2023, EB Corporation accrued a bonus of $25K to each shareholder. Assuming that the bonuses are paid to the shareholders on FEB, compute EB Corporation's 2023 deduction for the above amounts.

EB Corporation, a calendar year, accrual method C corporation, has two cash methods, calendar year shareholders who are unrelated to each other. George owns 35% of the stock, and Nancy owns the remaining 65%. During 2023, EB Corporation paid a salary of $200K to each shareholder. On December 31, 2023, EB Corporation accrued a bonus of $25K to each shareholder. Assuming that the bonuses are paid to the shareholders on FEB, compute EB Corporation's 2023 deduction for the above amounts.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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EB Corporation, a calendar year, accrual method C corporation, has two cash methods, calendar year shareholders who are unrelated to each other. George owns 35% of the stock, and Nancy owns the remaining 65%. During 2023, EB Corporation paid a salary of $200K to each shareholder. On December 31, 2023, EB Corporation accrued a bonus of $25K to each shareholder. Assuming that the bonuses are paid to the shareholders on FEB, compute EB Corporation's 2023 deduction for the above amounts.
Transcribed Image Text:EB Corporation, a calendar year, accrual method C corporation, has two cash methods, calendar year shareholders who are unrelated to each other. George owns 35% of the stock, and Nancy owns the remaining 65%. During 2023, EB Corporation paid a salary of $200K to each shareholder. On December 31, 2023, EB Corporation accrued a bonus of $25K to each shareholder. Assuming that the bonuses are paid to the shareholders on FEB, compute EB Corporation's 2023 deduction for the above amounts.
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