A Company Has Received $40,000 for Subscription Revenue in Advance

question 6

Multiple Choice

A company has received $40,000 for subscription revenue in advance and recorded a liability account 'revenue received in advance'.Revenue is taxed when it is received.The tax rate is 30 per cent.What is the tax base for this item?

• A) $0
• B) $40,000
• C) $12,000
• D) $36,000
• E) None of the given answers.

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Definitions:

Baby Boomers

The demographic cohort following the Silent Generation, generally defined as people born from the mid-1940s to the mid-1960s.

Marketers

Professionals or organizations that promote products, services, or brands to potential customers.

Products

Goods or services offered by businesses to satisfy consumer needs or wants.

Regulatory Environment

The collection of laws, regulations, and rules that govern and influence the conduct of businesses and individuals within a society.