Falcon Corporation, a C Corporation, Had Gross Receipts of $3

question 30

Multiple Choice

Falcon Corporation, a C corporation, had gross receipts of $3 million in 2008, $7 million in 2009, and $6 million in 2010. Hawk Corporation, a personal service corporation (PSC) , had gross receipts of $3 million in 2008, $5 million in 2009, and $4 million in 2010. Which of the corporations will be allowed to use the cash method of accounting in 2011?

• A) Neither Falcon Corporation nor Hawk Corporation.
• B) Both Falcon Corporation and Hawk Corporation.
• C) Falcon Corporation only.
• D) Hawk Corporation only.
• E) None of the above.

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Definitions:

Measure of Variability

Statistical indicators that describe the spread or dispersion within a data set, such as range, variance, or standard deviation.

Range

A measure of variability, defined to be the largest value minus the smallest value.

Midrange

The statistical measure that calculates the average of the maximum and minimum values in a data set, giving a rough estimate of the data's central tendency.

Standard Deviation

An evaluation metric for the amount of variation or distribution in a set of numerical values.