Which of the following businesses must use the accrual method of accounting?
I.Pryor and Ransom,a local law firm with annual gross receipts of $650,000.
II.Mayson Manufacturing,which has annual gross receipts of $20,000,000.

Question

Which of the following businesses must use the accrual method of accounting?
I.Pryor and Ransom,a local law firm with annual gross receipts of $650,000.
II.Mayson Manufacturing,which has annual gross receipts of $20,000,000.
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Quizplus · Accepted Answer

Businesses with annual gross receipts over $25 million (as of 2023) are generally required to use the accrual method. Mayson Manufacturing, with $20 million in receipts, falls under this requirement. The law firm does not exceed this threshold.

Which of the Following Businesses Must Use the Accrual Method