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Jorgensen High Tech Inc. is a calendar-year, accrual-method taxpayer. At the end of year 1, Jorgensen...

Jorgensen High Tech Inc. is a calendar-year, accrual-method taxpayer. At the end of year 1, Jorgensen accrued and deducted the following bonuses for certain employees for financial accounting purposes.

$60,400 for Ken.

$45,300 for Jayne.

$30,200 for Jill.

$15,100 for Justin.

How much of the accrued bonuses can Jorgensen deduct in year 1 under the following alternative scenarios?

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

c. Jorgensen paid the bonuses to employees on March 1 of year 2, and there is a requirement that the employee must remain employed with Jorgensen on the payment date to receive the bonus.
d. Jorgensen paid the bonuses to employees on March 1 of year 2, and there is a requirement that the employee must remain employed with Jorgensen on the payment date to receive the bonus; if not, the forfeited bonus is reallocated to the other employees.

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ekkarill92 answered 1 year ago
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