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Pritzker Incorporated, a calendar year, accrual basis taxpayer, is being sued for breach of contract...

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Accounting

Pritzker Incorporated, a calendar year, accrual basis taxpayer, is being sued for breach of contract by a former business partner. Pritzker's auditors required the corporation to accrue a $1,000,000 contingent liability and current year expense. Which of the following statements is TRUE?
Group of answer choices
Pritzker can deduct the expense in the year of payment.
Pritzker can deduct the expense in the year in which the liability becomes fixed and determinable.
Pritzker can never deduct the $1,000,000 expense.
Pritzker can currently deduct the $1,000,000 accrued expense.

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