McGraw-Hill's Taxation of Individuals and Business Entities 3rd Edition by Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver

Exercise 55

Rebecca is a calendar-year taxpayer who operates a business.She made the following business-related expenditures in December of year 0.Indicate the amount of these payments that she may deduct in year 0 under both the cash method of accounting and the accrual method of accounting.a.$2,000 for an accountant to evaluate the accounting system of Rebecca's business.The accountant spent three weeks in January of year 1 working on the evaluation.b.$2,500 for new office furniture.The furniture was delivered on January 15, year 1.c.$3,000 for property taxes payable on her factory.d.$1,500 for interest on a short-term bank loan relating to the period from November 1, year 0 through March 31, year 31.