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Problem 5-17 (LO. 2, 3) Broadbill Corporation, a calendar year C corporation, has two unrelated cash method shareholders: Marcia owns 51% of the stock, and
Problem 5-17 (LO. 2, 3) Broadbill Corporation, a calendar year C corporation, has two unrelated cash method shareholders: Marcia owns 51% of the stock, and Zack owns the remaining 49%. Each shareholder is employed by the corporation at an annual salary of $240,000. During 2019, Broadbill paid each shareholder-employee $220,000 of his or her annual salary, with the remaining $20,000 paid in January 2020. Determine how much of the 2019 salaries for Marcia and Zack is deductible by Broadbill in 2019 if the corporation is (a) a cash method taxpayer and (b) an accrual method taxpayer. a. If a cash method taxpayer: In 2019, Broadbill can deduct $ b. If an accrual method taxpayer: In 2019, Broadbill can deduct $
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