During the current year, Hope Corporation paid a $3,250 premium for a life insurance policy on the life of the chief executive officer, Joel. Determine the deductibility of the $3,250.
I.Hope could deduct the premium as compensation if Joel's daughter is the stated beneficiary of the policy.II.The premium is not deductible if Hope Corporation is the beneficiary.?
A. Only statement I is correct.
B. Only statement II is correct.
C. Both statements are correct.
D. None of the statements are correct.
Answer: C
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