Question

Under both the cash method and accrual method, how much is deductible for taxes?

1) $3,000
2) $2,000
3) $4,000
4) $5,000

Answer 1

It's not possible to determine the tax deductible amount without specific details on financial activities. Both the cash method and the accrual method depend on actual transactions within the tax year.

Step-by-step explanation:

In the context of tax accounting under both the cash method and the accrual method, the amount that is deductible can vary based on the actual expenses and revenues recognized during the tax year. However, without specific details regarding the nature of the expenses or the revenues, it is impossible to determine from the provided tables how much is deductible for taxes. To accurately calculate the tax deductible amount, one would need to consider all relevant financial activities, including explicit and implicit costs as well as total revenues.