Cathy,an Attorney,bills a Client $12,000 for Services Rendered in November

Essay

Cathy,an attorney,bills a client $12,000 for services rendered in November 2013.The client is having cash flow problems and Cathy accepts 1,000 shares of Petrol Corporation common stock in full satisfaction of the account on July 5,2014.On July 5,2014,the Petrol stock is selling for $10 per share.Cathy sells the Petrol stock on August 10,2014,for $11 per share.What is the effect of the transactions on Cathy's 2014 taxable income if
a.Cathy is a cash basis taxpayer?
b.Cathy is an accrual basis taxpayer?