a | |
Cash received for Medical services | 607800 |
Add: Advance payment received | 16000 |
Gross income using the cash basis of accounting | 623800 |
b | |
Cash received for Medical services | 607800 |
Less: Payment against services provided in 2019 | -33600 |
Add: Accounts Receivable at the end of 2020 | 91400 |
Gross income using the accrual basis of accounting | 665600 |
c |
Al should use the cash method of accounting so that he will not have to pay income taxes on the uncollected accounts receivable |
Problem 4-31 (Algorithmic) (LO. 2, 5) Al is a medical doctor who conducts his practice as...
Problem 4-31 (Algorithmic) (LO. 2,5) Al is a medical doctor who conducts his practice as a sole proprietor. During 2020, he received cash of $474,800 for medical services. Of the amount collected, $54,000 was for services provided in 2019. At the end of 2020, Al had accounts receivable of $89,700, all for services rendered in 2020. In addition, at the end of the year, Al received $16,500 as an advance payment from a health maintenance organization (HMO) for services to...
Problem 4-15 (Algorithmic) (LO. 2) Al is a physician who conducts his practice as a sole proprietor. During 2019, he received cash of $558,400 for medical services. Of the amount collected, $40,800 was for services provided in 2018. At the end of 2019, Al held accounts receivable of $89,700, all for services rendered in 2019. In addition, at the end of the year, Al received $17,000 as an advance payment from a health maintenance organization (HMO) for services to be...
Al is a medical doctor who conducts his practice as a sole proprietor. During 2019, he received cash of $592,600 for medical services. Of the amount collected, $52,800 was for services provided in 2018. At the end of 2019, Al had accounts receivable of $93,100, all for services rendered in 2019. In addition, at the end of the year, Al received $16,000 as an advance payment from a health maintenance organization (HMO) for services to be rendered in 2020. a....
Al is a medical doctor who conducts his practice as a sole proprietor. During 2020, he received cash of $661,000 for medical services. Of the amount collected, $40,800 was for services provided in 2019. At the end of 2020, Al had accounts receivable of $96,500, all for services rendered in 2020. In addition, at the end of the year, Al received $16,500 as an advance payment from a health maintenance organization (HMO) for services to be rendered in 2021. a....
oblem Set Question 17 0.5 pts owns an accounting practice (sole proprietorship). During 2020, Al received payments of $200,000. The $200,000 consists of: • $30,000 payment for services rendered in 2019 but not paid by the client until 2020 • $160,000 payment for services rendered and paid in 2020 • $10,000 prepayment received in 2020 for services that will be rendered in 2021 In addition to the $200,000 payments received in 2020, at the end of 2020 Al held accounts...
Ann owns an accounting practice (sole proprietorship). During 2020, Ann received payments of $200,000. The $200,000 consists of: $30,000 payment for services rendered in 2019 but not paid by the client until 2020 $160,000 payment for services rendered and paid in 2020 $10,000 prepayment received in 2020 for services that will be rendered in 2021 In addition to the $200,000 payments received in 2020, at the end of 2020 Ann held accounts receivable of $10,000, all for services rendered in...
Ann owns an accounting practice (sole proprietorship). During 2020, Ann received payments of $200,000. The $200,000 consists of $30,000 payment for services rendered in 2019 but not paid by the client until 2020 $160,000 payment for services rendered and paid in 2020 $10,000 prepayment received in 2020 for services that will be rendered in 2021 In addition to the $200,000 payments received in 2020, at the end of 2020 Ann held accounts receivable of $10,000, all for services rendered in...
Question 16 0.4 pts Ann owns an accounting practice (sole proprietorship). During 2020, Ann received payments of $200,000. The $200,000 consists of: • $30,000 payment for services rendered in 2019 but not paid by the client until 2020 • $160,000 payment for services rendered and paid in 2020 • $10,000 prepayment received in 2020 for services that will be rendered in 2021 In addition to the $200,000 payments received in 2020, at the end of 2020 Ann held accounts receivable...
Problem 3 : Samantha is a CPA. She operates a tax return preparation service business as a sole proprietorship. During 2020, she received cash of $95,000 for tax return preparation services. Of the amount received in 2020, $3,500 relates to payment of late invoices for tax services provided during 2019. Samantha also has accounts receivable of $9,000 for services provided in 2020. Compute Samantha’s gross income for the year 2020 under (a) the cash method of accounting and (b) the...
Problem 5-55 (LO. 3) How does the tax benefit rule apply in the following cases? a. In 2018, the Orange Furniture Store, an accrual method sole proprietorship, sold furniture on credit for $1,000 to Sammy. The cost of the furniture was $600. In 2019, Orange took a bad debt deduction for the $1,000. In 2020, Sammy inherited some money and paid Orange the $1,000 he owed. Orange's owner was in the 35% marginal tax bracket in 2018, the 12% marginal...