Beth Is an Accrual Basis Taxpayer

question 82

Multiple Choice

Beth is an accrual basis taxpayer.A renter pays Beth the January 2018 rent in December 2017.What are the tax effects of this transaction?
I.Beth will recognize rent income in 2017.
II.The wherewithal-to-pay concept requires Beth to recognize the income in 2017.
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• 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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