Ajax Computer Company is an accrual method calendar year taxpayer. Ajax has never advertised in...
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Ajax Computer Company is an accrual method calendar year taxpayer. Ajax has never advertised in the national media prior to this year. In November of this year, however, Ajax paid $2.7 million for television advertising time during a "super" sporting event scheduled to take place in early February of next year. In addition, in November of this year the company paid $2,200,000 for advertising time during a professional golf tournament which will occur once in April of next year. What amount of these payments, if any, can Ajax deduct this year?
A) 2.70 million
B) 2,200,000
C)$4.90 million only if the professional golf tournament is played before April 15.
D) No deduction can be claimed this year.
E) $4.90 million
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