Speak Corporation,a calendar year accrual basis taxpayer,sells packages of foreign language lessons to individuals planning to work overseas. In December,2014,it sold and received payment for $600,000 of 24-month lesson packages to be provided evenly through 2015 and 2016. Speak Corporation will recognize the $600,000 of income

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Since Speak Corporation is an accrual basis taxpayer, it recognizes income when it earns it, which is when it provides the foreign language lessons to the customers. The $600,000 received in December 2014 is considered unearned revenue and is not recognized as income until the lessons are provided. Since the lessons are to be provided evenly over the 24-month period of 2015 and 2016, Speak Corporation will recognize the income evenly over those two years. Therefore, the $600,000 of income will be recognized all in 2015.

Speak Corporation,a Calendar Year Accrual Basis Taxpayer,sells Packages of Foreign