Question
You run a magazine publishing company and are approached on January 10th by the salesperson from your largest ink supplier. She advises you that the
You run a magazine publishing company and are approached on January 10th by the salesperson from your largest ink supplier. She advises you that the company just announced a price increase effective January 1, however, she will accept an order at the old prices if you submit the order today and backdate the order to December 28. You ask why she is willing to do that and she explains that her commission rate was higher under the old pricing structure and by backdating, not only do you get a lower price, but she will get a higher commission, and you can claim this purchase as an expense for last year which will lower your taxes.
Determine which of the following answers best describes the situation above and your business decisions.
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