In 2018, T Corporation changed its tax year from ending each April 30th to ending each December 31st. The corporation earned $60,000 during the period May 1, 2018 through December 31, 2018. The annualized income for the short year is $90,000.

Question

Quizplus · Accepted Answer

To calculate the annualized income for the short year, we need to take the actual earnings ($60,000) and multiply them by 12/8 (since the period is 8 months instead of 12). This gives us $90,000, which is the correct annualized income for the short year. Therefore, the statement is true.

In 2018, T Corporation Changed Its Tax Year from Ending