Value corporation is a calendar year taxpayer that uses the accrual method of accounting. On December 10 of the current year Value accrues a bonus payment of $100000 to Bret, its president and sole shareholder. Brett is a calendar year taxpayer who uses the cash method of accounting.
a) When can Value deduct the bonus if it pays it to bret on March 11 of teh next year? Om march 18 of the next year?
b) How would your answer to part a change if brett were an employee of Value who owns no stock in the corporation?