Question

In financial statements prepared on the income-tax basis, how should the nondeductible portion of expenses, such as meals and entertainment, be reported________

Answer 1

Expense(s) category

Step-by-step explanation:

Expenses such as entertainment and meals are meant to be included in the expense category of the financial statements even when these expenses are not deductible for tax purposes. This is beacuse the meals and entertainment are business expenses and as such should be included in the financial statements as every expense is important in proper income calculation.

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