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McGraw-Hill's Taxation of Business Entities 3rd Edition by Connie Weaver, Brian Spilker, Edmund Outslay, John Robinson, Ronald Worsham, Benjamin Ayers, John Barrick
Edition 3ISBN: 9780077924522McGraw-Hill's Taxation of Business Entities 3rd Edition by Connie Weaver, Brian Spilker, Edmund Outslay, John Robinson, Ronald Worsham, Benjamin Ayers, John Barrick
Edition 3ISBN: 9780077924522 Exercise 9
On April 1 of year 0 Stephanie received a $9,000 payment for full payment on a three-year service contract (under the contract Stephanie is obligated to provide advisory services for the next three years).
a. What amount of income should Stephanie recognize in year 0 if she uses the accrual method of accounting (she recognized $2,250 for financial accounting purposes)
b. What amount of income will Stephanie recognize in year 1 if she uses the accrual method of accounting
c. What amount of income will Stephanie recognize in year 2, if she uses the accrual method of accounting
d. What amount of income will Stephanie recognize in year 0 if she recognizes $5,000 of income from the contract for financial statement purposes
a. What amount of income should Stephanie recognize in year 0 if she uses the accrual method of accounting (she recognized $2,250 for financial accounting purposes)
b. What amount of income will Stephanie recognize in year 1 if she uses the accrual method of accounting
c. What amount of income will Stephanie recognize in year 2, if she uses the accrual method of accounting
d. What amount of income will Stephanie recognize in year 0 if she recognizes $5,000 of income from the contract for financial statement purposes
Explanation
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Accrual Basis:
Under the accrual basis ...
McGraw-Hill's Taxation of Business Entities 3rd Edition by Connie Weaver, Brian Spilker, Edmund Outslay, John Robinson, Ronald Worsham, Benjamin Ayers, John Barrick
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