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What year can klaxon deduct the bonus paid to susanne

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Problem 1: Susanne Watson is an employee and sole-shareholder of Klaxon. Klaxon is a calendar-year company which uses the accrual method of accounting. On December 30, 2018, Klaxon awarded Susanne a bonus of $30,000 based on the company's 2017 year-end profit. The bonus was reasonable, ordinary and necessary. It was paid on February 11, 2019. In what year can Klaxon deduct the bonus it paid to Susanne? Susanne is a calendar-year, cash method taxpayer.

Option 1) 2017

Option 2) 2018

Option 3) 2019

Option 4) The bonus cannot be deducted by Klaxon, Inc.

Reference no: EM132572683

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