B Corporation, an accrual basis taxpayer, is owned 75 percent by Bonnie, a cash basis taxpayer. On December 31, 20X1, the corpor
ation accrues interest of $4,000 on a loan from Bonnie and also accrues a $15,000 bonus to Bonnie. The bonus is paid to Bonnie on March 1, 20X2; the interest is not paid until 20X3. How much can B Corporation deduct on its 20X2 tax return?a. $0b. $4,000c. $15,000d. $19,000e. $12,00
1 answer:
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Answer:
a. Anywhere inside or on the production possibilities frontier.
Explanation:
In an economy, the allocative efficiency may be defined as the economic state where the production of various goods or services is aligned with the preferences with the consumers.
The allocative efficiency always materializes at the intersection of the supply curves and the demand curves.
On the the price for a supply
with the demand for the product
at that price, and thus all the products are sold.
It occurs anywhere on the production possibilities frontier or on the inside of the frontier.
Therefore, the correct option is (a).