KOM pays the following insurance premiums during 2018: a. If KOM uses the accrual method of accounting,
Question:
KOM pays the following insurance premiums during 2018:
a. If KOM uses the accrual method of accounting, what is the insurance expense deduction for 2018?
b. If KOM uses the cash method of accounting, what is the insurance expense deduction for 2018?
Transcribed Image Text:
Auto accident and liability insurance: Paid 1/1/18 Coverage period 1/1/18 - 12/31/18 Fire, storm, and other casualty insurance: Paid 4/1/18 Coverage period 4/1/18 - 3/31/20 Business liability insurance: Paid 5/1/18 Coverage period 5/1/18 - 4/30/19 $3,500 $5,000 $3,000
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a Using the accrual method of accounting KOMs 2018 insurance expense deduction is 7375 3500 1875 2000 Note The deduction is only 7375 if the business ...View the full answer
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Related Book For
Concepts In Federal Taxation
ISBN: 9781337702621
26th Edition
Authors: Kevin E. Murphy, Mark Higgins
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