Which of the Following Taxpayers Is Required to Use the Accrual

question 40

Multiple Choice

Which of the following taxpayers is required to use the accrual method of accounting?

• A) A retail business with average annual gross receipts of $8,000,000.
• B) A medical doctor with average annual gross receipts of $2 million.
• C) An insurance agency with average annual gross receipts of $5 million.
• D) All of the above are required to use the accrual method.
• E) None of the above is required to use the accrual method.

---

Definitions:

E-commerce Servers

Dedicated servers that host websites and applications for online marketing and sales transactions.

Root DNS Server

A domain name system (DNS) server that contains the master listings for an entire top-level domain.

Master Listings

Detailed listings or directories that contain comprehensive information on a specific subject or category.

Top-level Domain

The highest level in the hierarchical Domain Name System of the Internet, indicated by the last part of a domain name.