Jones operates an upscale restaurant and he pays experienced cooks $43,000 per year. This year he hired his son as an apprentice cook. Jones agreed to pay his son $46,400 per year. Which of the following is a true statement about this transaction?

Jones will be allowed to deduct $46,400 only if his son eventually develops into an expert cook.

Jones can only deduct $23,200 because an apprentice cook is only worth half as much as an experienced cook.

None of these.

Jones will be allowed to deduct $43,000 as compensation and another $3,400 can be deducted as an employee gift.

Jones will be allowed to accrue $46,400 only if he pays his son in cash.