For Purposes of Determining Gross Income, Which of the Following

question 91

Multiple Choice

For purposes of determining gross income, which of the following is true?

• A)A mechanic completed repairs on an automobile during the year and collects money from the customer.The customer was not satisfied with the repairs and sued the mechanic for a refund.The mechanic can defer recognition of the income until the suit has been settled.
• B)A taxpayer who finds a wallet full of money is required to recognize income even though someone may eventually ask for the return of the money.
• C)Embezzlement proceeds are not included in the embezzler's gross income because the embezzler has an obligation to repay the owner.
• D)All of these are false.
• E)All of these are true.