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Tony owns 100% of TNT's common stock. Tony, the president of TNT, is a cash...

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Accounting

Tony owns 100% of TNT's common stock. Tony, the president of TNT, is a cash basis taxpayer while TNT is an accrual basis taxpayer. On December 31, 20X1, TNT accrues a bonus payable for 20X1 to Tony of $25,000. TNT pays the $25,000 bonus to Tony on January 2, 20X2. What is the proper characterization of TNT's deduction.

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