Joline Is a Cash Basis Taxpayer

question 79

Multiple Choice

Joline is a cash basis taxpayer. A renter pays Joline the January 2014 rent in December 2013. What are the tax effects of this transaction? I. Joline will recognize rent income for tax purposes in 2014. II. The wherewithal­to­pay concept is the basis for Joline's recognition of the income in 2014.

• A) Only statement I is correct.
• B) Only statement II is correct.
• C) Both statements are correct.
• D) Neither statement is correct.

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Definitions:

Functional Play

Play involving repetitive large muscular movements.

Constructive Play

A type of play involving the building or creation of something, fostering problem-solving skills, creativity, and motor skills in children.

Sex Segregation

The physical, legal, or cultural separation of people according to their biological sex.

Play

A range of voluntary, intrinsically motivated activities normally associated with pleasure and enjoyment.