Multiple Choice
In October 2017,Jonathon Remodeling Co. ,an accrual-method taxpayer,remodels and renovates an office building for Dale and bills him $30,000.Dale signs a note for the debt.Dale keeps delaying payment and files bankruptcy in 2018.Creditors are informed that no assets are available for payment.Jonathon Remodeling Co.will report
A) $0 income in both years.
B) $30,000 income in 2017 and a bad debt deduction of $30,000 in 2018.
C) $30,000 income in 2017 and a STCL of $30,000 in 2018 limited to $3,000 after netting.
D) $30,000 income in 2017 and then must amend last year's return to show $0 income when advised of the bankruptcy.
Correct Answer:
Verified
Correct Answer:
Verified
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