Which of the Following Statements Is Always True Regarding Accounting

question 11

Multiple Choice

Which of the following statements is always true regarding accounting methods available to a partnership?

• A)If a partnership is a tax shelter, it can use the cash method of accounting.
• B)If a non-tax-shelter partnership had "average annual gross receipts" of $3 million in all prior years, it can use the cash method.
• C)If a partnership has a partner that is a personal service corporation, it cannot use the cash method.
• D)If a partnership has a partner that is a C corporation, it cannot use the cash method.
• E)All of the above statements are false.