The Taxpayer Had Incorrectly Been Using the Cash Method of Accounting

question 29

Multiple Choice

The taxpayer had incorrectly been using the cash method of accounting. For 2017, the company voluntarily changed to the accrual method. The adjustment due to the change in method as calculated at the beginning of 2017 was $120,000 (positive) . The adjustment as calculated as of the end of 2017 was $80,000 (positive) . As a result of the change in method, the company must:

• A)Increase its income for 2017 by $120,000.
• B)Increase its income for 2017 by $80,000.
• C)Increase its income for 2017 by $30,000.
• D)Increase its income for 2017 by $40,000.
• E)None of the above.

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Definitions:

François Magendie

A French physiologist known for his pioneering research in experimental physiology and his contributions to the understanding of the nervous system's functions.

Segregation

The act of separating individuals or groups apart from each other based on different criteria, such as race, gender, or socio-economic status.

Autonomic Nervous System (ANS)

A component of the peripheral nervous system that controls bodily functions not consciously directed, such as breathing, the heartbeat, and digestive processes.

Illness

A condition of poor health perceived or experienced by an individual as an invasion, disorder, or loss of function in one's body or mind.