LSG Company is a calendar year, cash basis taxpayer. On November 1, 2018, LSG paid $9,450 cash
Question:
LSG Company is a calendar year, cash basis taxpayer. On November 1, 2018, LSG paid $9,450 cash to the janitorial service firm that cleans LSG's administrative offices and retail stores. How much of this expenditure can LSG deduct in 2018 assuming that:
a. The expenditure is a prepayment for six months of cleaning services from November 2018 through April 2019?
b. The expenditure is a prepayment for 18 months of cleaning services from November 2018 through April 2020?
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Step by Step Answer:
a LSG can deduct the entire 9450 expenditure in 2018 the year of payment because the expen...View the full answer
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Related Book For 
Principles Of Taxation For Business And Investment Planning 2019 Edition
ISBN: 9781260161472
22nd Edition
Authors: Sally Jones, Shelley C. Rhoades Catanach, Sandra R Callaghan
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