North Inc. is a calendar-year C corporation, accrual-basis taxpayer. At the end of year 1, North acc

North Inc. is a calendar-year C corporation, accrual-basis taxpayer. At the end of year 1, North accrued and deducted the following bonuses for certain employees for financial accounting purposes. $15,050 for Lisa Tanaka, a 25 percent shareholder. $16,900 for Jared Zabaski, a 30 percent shareholder. $13,200 for Helen Talanian, a 25 percent shareholder. $5,550 for Steve Nielson, a 5 percent shareholder.

Unless stated otherwise, assume these shareholders are unrelated.

How much of the accrued bonuses can North Inc. deduct in year 1 under the following alternative scenarios? (Leave no answer blank. Enter zero if applicable.)

b. North paid the bonuses to the employees on April 1 of year 2.

North Inc. is a calendar-year C corporation, accrual-basis taxpayer. At the end of year 1, North accrued and deducted the following bonuses for certain employees for financial accounting purposes. $15,050 for Lisa Tanaka, a 25 percent shareholder. $16,900 for Jared Zabaski, a 30 percent shareholder. $13,200 for Helen Talanian, a 25 percent shareholder. $5,550 for Steve Nielson, a 5 percent shareholder.

Unless stated otherwise, assume these shareholders are unrelated.

How much of the accrued bonuses can North Inc. deduct in year 1 under the following alternative scenarios? (Leave no answer blank. Enter zero if applicable.)

c. North paid the bonuses to employees on March 1 of year 2 and Lisa and Jared are related to each other, so they are treated as owning each other’s stock in North.

North Inc. is a calendar-year C corporation, accrual-basis taxpayer. At the end of year 1, North accrued and deducted the following bonuses for certain employees for financial accounting purposes. $15,050 for Lisa Tanaka, a 25 percent shareholder. $16,900 for Jared Zabaski, a 30 percent shareholder. $13,200 for Helen Talanian, a 25 percent shareholder. $5,550 for Steve Nielson, a 5 percent shareholder.

Unless stated otherwise, assume these shareholders are unrelated.

How much of the accrued bonuses can North Inc. deduct in year 1 under the following alternative scenarios? (Leave no answer blank. Enter zero if applicable.)

d. North paid the bonuses to employees on March 1 of year 2 and Lisa and Helen are related to each other, so they are treated as owning each other’s stock in North.

 

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