method calendar year corporation, has three cash method, calendar year shareholders. Sam, Shelia and Susan. Sam owns 60% of Myrvin and Shelia and Susan own 20% each. The shareholders are unrelated to each other. During 2021, Myrvin paid a salary of $100,000 to each shareholder. On December 31, 2021, Myrvin accrued a bonus of $35,000 to Sam and $45,000 to Shelia. Assuming that the bonuses were paid to Sam and Shelia on February 1, 2022, compute Myrvin Corporation's 2020 deduction for the above amounts. Select one:
method calendar year corporation, has three cash method, calendar year shareholders. Sam, Shelia and Susan. Sam owns 60% of Myrvin and Shelia and Susan own 20% each. The shareholders are unrelated to each other. During 2021, Myrvin paid a salary of $100,000 to each shareholder. On December 31, 2021, Myrvin accrued a bonus of $35,000 to Sam and $45,000 to Shelia. Assuming that the bonuses were paid to Sam and Shelia on February 1, 2022, compute Myrvin Corporation's 2020 deduction for the above amounts. Select one:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Myrvin Corporation an accrual method calendar year corporation, has three cash method, calendar year shareholders. Sam, Shelia and Susan. Sam owns 60% of Myrvin and Shelia and Susan own 20% each. The shareholders are unrelated to each other. During 2021, Myrvin paid a salary of $100,000 to each shareholder. On December 31, 2021, Myrvin accrued a bonus of $35,000 to Sam and $45,000 to Shelia. Assuming that the bonuses were paid to Sam and Shelia on February 1, 2022, compute Myrvin Corporation's 2020 deduction for the above amounts.
Select one:
a.
$350,000
b.
$325,000
c.
$300,000
d.
$345,000
e.
None of above.
Expert Solution
Step 1
Shareholders refer to the entities who buy shares of a company in order to receive a section of the company's profits with also the right to vote in the company's decisions.
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