Unrelated cash method shareholders

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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 2016, Broadbill paid each shareholder-employee $220,000 of his or her annual salary, with the remaining $20,000 paid in January 2017. How much of the 2016 salaries for Marcia and Zack is deductible by Broadbill in 2016?

For a cash method taxpayer, the amount of the 2016 salaries that is deductible in 2016?

For an accrual method taxpayer, in 2016, Broadbill can deduct?

Reference no: EM131402406

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