Detail The High Cost of A Free Lunch   Oleh:  Johnston, Earl B. Jenis: Article from Bulletin/Magazine Dalam koleksi: Journal of Accountancy vol. 189 no. 6 (2000), page 61-65. Topik: costs; high cost; free lunch Ketersediaan Perpustakaan Pusat (Semanggi) Nomor Panggil: JJ85.10 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada     Lihat Detail Induk Isi artikel Entertaining is a necessary, if expensive, part of doing business. To treat a New York client to drinks, dinner and a Broadway show can cost $500 or more for two. Meals and entertainment (M&E) expenses may be only slightly lower in cities such as Chicago, Dallas, San Francisco or Seattle. As a general rule, a company can deduct only 50 % of business M&E expenses. However, careful tax planning lets companies take advantage of exceptions to this rule to increase the tax deductibility of certain M&E expenses. If a company’s M&E expenses match one of the exceptions, they are 100 % deductible. Proper recordkeeping is essential. Most companies lump M&E expenses in one type of general ledger account. The company reduces the ending balance in the account by the 50 % exclusion, then claims the remainder as a tax deduction on its federal corporate income tax return. However, by separately identifying, accumulating and reporting M&E expenses that are not subject to the 50% exclusion, most companies can realize a direct tax benefit. In addition, because M&E is a permanent book/tax difference (a current - period expense a company recognizes in its financial statement calculation of net income that is never allowed as a tax deduction), increasing deductible M & E expenses will lower a company’s effective tax rate, thereby increasing its net income. CPA s can play a valuable role in helping their employers change some accounting practices to increase M & E deductions. But first, it’s important to clearly understand what kinds of expenses are eligible for the 100 % deduction. Opini Anda Klik untuk menuliskan opini Anda tentang koleksi ini! Kembali

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