With Respect to the Prepaid Income from Services, Which of the Following

question 5

Multiple Choice

With respect to the prepaid income from services, which of the following is true?

• A)The treatment of prepaid income is the same for tax and financial accounting.
• B)A cash basis taxpayer can spread the income over the period services are to be provided if all of the services will be completed by the end of the tax year following the year of receipt.
• C)An accrual basis taxpayer can spread the income over the period services are to be provided if all of the services will be completed by the end of the tax year following the year of receipt.
• D)An accrual basis taxpayer can spread the income over the period services are to be provided on a contract for three years or less.
• E)None of these.

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Definitions:

Linked Pictures

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Syntax

The set of rules that defines the structure and composition of phrases and sentences in a programming language or markup language.

Fill Handle

A feature in spreadsheet software that allows users to extend a series of values, formulas, or data by dragging a small square at the corner of the selected cell(s).

NETWORKDAYS Function

A function in spreadsheets that calculates the number of working days between two dates, excluding weekends and any specified holidays.