Teal Company Is an Accrual Basis Taxpayer

question 55

Multiple Choice

Teal company is an accrual basis taxpayer. On December 1, 2018, a customer paid for an item that was on hand, but the customer wanted the item delivered in early January 2019. Teal delivered the item on January 4, 2019. Teal included the sale in its 2018 income for financial accounting purposes.

• A) Teal must recognize the income in 2018.
• B) Teal must recognize the income in the year title to the goods passed to the customer, as determined under the state laws in which the store is located.
• C) Teal can elect to recognize the income in either 2018 or 2019.
• D) Teal must recognize the income in 2019.
• E) None of these.

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Definitions:

Types of Attributions

These are explanations for behaviors or events, often categorized as internal (personal) or external (situational) attributions.

Expectancy

In psychology, the anticipation or belief regarding the likelihood that a particular behavior will lead to a specific outcome, heavily influencing motivations and actions.

Types of Expectancies

Different forms of anticipation or belief about what may happen in the future, often based on past experiences or social cues.

Stimulus Generalization

A conditioned response or operant behavior to a stimulus that is similar to the conditioned stimulus or discriminative stimulus.