Dave Is a Plumber Who Uses the Cash Method of Accounting.This

question 103

Multiple Choice

Dave is a plumber who uses the cash method of accounting.This year Dave requested that his clients make their checks payable to his son,Steve.This year Steve received checks in the amount of $62,000 for Dave's plumbing services.Which of the following is a true statement?

• A) Dave is taxed on $62,000 of plumbing income this year.
• B) Steve is taxed on $62,000 of plumbing income this year.
• C) Steve is taxed on $62,000 of income from gifts received this year.
• D) Dave may deduct the $62,000 received by Steve.
• E) None of the choices are true.

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Definitions:

True Zero

A point on a scale which represents a complete absence of the measured entity, not merely an arbitrary point.

Powerful

Having great control, influence, or effect on others or outcomes.

Polynomial Scale

A mathematical scale used for measurement that involves variables raised to various powers; commonly used in algebra to solve equations and represent data.

Intercoder Reliability

A measure of the extent to which different observers or analysts consistently apply a coding scheme to assess qualitative data.