Which of the following is an allowable deduction for corporations?

Salaries paid to employees are an allowable deduction for corporations because they are a necessary expense incurred in the ordinary course of business operations. The Internal Revenue Code allows corporations to deduct these expenses to arrive at their taxable income. This helps reflect the true economic performance of the business, as employee salaries are essential for maintaining operations and generating revenue.

In contrast, owner’s personal expenses are not deductible because they do not relate to the business activities of the corporation and are considered personal in nature. Fines and penalties are generally not deductible due to public policy considerations, as allowing such deductions would undermine the deterrent effect of such penalties. Income taxes paid by a corporation are also not deductible when calculating taxable income, as they are considered an expense related to the corporation's tax liability, rather than a business operating expense. Thus, the only correct response highlighting an allowable deduction is the salaries paid to employees.