Alex Is a Calendar-Year Sole Proprietor

question 4

Multiple Choice

Alex is a calendar-year sole proprietor.He began business on December 1,this year.He uses the accrual method of accounting.Alex had the following collections in December: • Collected $7,000 in December,from clients who paid cash for services to be performed next year.
• Collected $5,000 in December,for services performed during December; deposited in an operating account on December 31,this year.
• Collected $12,000 in December; on accounts receivable for services performed in December; deposited in operating account on January 2,next year.
What is the amount Alex must include in his income for December?

• A)$7,000
• B)$12,000
• C)$17,000
• D)$24,000

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Definitions:

Planetary Management

A worldview or philosophy that regards humans as the dominant species responsible for managing Earth's resources for maximum benefit.

Life-Support Systems

Systems or equipment used to sustain human life in situations where essential necessities are not naturally available, often used in space exploration or undersea habitats.

Earth's Resources

Natural materials and components that can be utilized by humans for various purposes, including water, minerals, forests, and fossil fuels.

Stewardship

The responsible overseeing and protection of something considered worth caring for and preserving, often related to the environment or natural resources.