Which of the following is/are tax-deductible expense(s) for a corporation? a. Dividends paid on the corporation’s...

Which of the following is/are tax-deductible expense(s) for a corporation?

	a.	Dividends paid on the corporation’s stock
	b.	Interest paid on the corporation’s bonds
	c.	Both interest and dividends paid
	d.	Neither interest nor dividends paid

Expert Solution

The answer is

b. Interest paid on the corporation’s bonds

Interest paid is tax deductible while dividend payments are not

That's why they are paid from after tax income of the corporation.

jeff jeffy answered 2 years ago

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