At the beginning of 2010,the taxpayer voluntarily changed from the cash to the accrual method of accounting.The relevant account balances as of January 1,2010,were as follows:
A)The company has a positive adjustment to income of $240,000 that must be recognized in 2010.
B)The company has a positive adjustment to income of $180,000 that can be allocated equally to years 2010-2013.
C)The company has a positive adjustment to income that can be allocated as follows: $47,500 to 2010 income,and $47,500 to each year's income,2011-2013.
D)No adjustment is required,but the company cannot use the cash method to report income and expenses for 2010.
E)None of the above.

Question

At the beginning of 2010,the taxpayer voluntarily changed from the cash to the accrual method of accounting.The relevant account balances as of January 1,2010,were as follows: 
A)The company has a positive adjustment to income of $240,000 that must be recognized in 2010. 
B)The company has a positive adjustment to income of $180,000 that can be allocated equally to years 2010-2013. 
C)The company has a positive adjustment to income that can be allocated as follows: $47,500 to 2010 income,and $47,500 to each year's income,2011-2013. 
D)No adjustment is required,but the company cannot use the cash method to report income and expenses for 2010. 
E)None of the above.

Quizplus · Accepted Answer

The Answer of At the beginning of 2010,the taxpayer voluntarily changed from the cash to the accrual method of accounting.The relevant account balances as of January 1,2010,were as follows: 
A)The company has a positive adjustment to income of $240,000 that must be recognized in 2010. 
B)The company has a positive adjustment to income of $180,000 that can be allocated equally to years 2010-2013. 
C)The company has a positive adjustment to income that can be allocated as follows: $47,500 to 2010 income,and $47,500 to each year's income,2011-2013. 
D)No adjustment is required,but the company cannot use the cash method to report income and expenses for 2010. 
E)None of the above.

At the Beginning of 2010,the Taxpayer Voluntarily Changed from the Cash