Question

Charlie’s Green Lawn Care is a cash basis taxpayer. Charlie Adame, the sole proprietor, is considering delaying some of...

Charlie’s Green Lawn Care is a cash basis taxpayer. Charlie Adame, the sole proprietor, is considering delaying some of his December 2018 customer billings for lawn care into the next year. In addition, he is thinking about paying some of the bills in late December 2018, which he would ordinarily pay in January 2019. This way, Charlie claims, he will have “less income and more expenses, thereby paying less tax!”Is Charlie’s way of thinking acceptable?

0 0
Add a comment Improve this question Transcribed image text
Answer #1
  1. Charlie's way of thinking to defer the tax by prepone of expenses and postpone of revenue is not at all a good idea.
  2. Even if he does so he will be required to pay the tax in the following years.
  3. More over as Charlie is following cash basis, he should recognise the revenue when he receives the payment and expenses when he makes the payment.
  4. Mere creation of bills and incurring of expenses in the way as said in question he can't escape the payment of tax.
Add a comment
Know the answer?
Add Answer to:
Charlie’s Green Lawn Care is a cash basis taxpayer. Charlie Adame, the sole proprietor, is considering delaying some of...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Charlie’s Green Lawn Care is a cash basis taxpayer. Charlie Adame, the sole proprietor, is considering...

    Charlie’s Green Lawn Care is a cash basis taxpayer. Charlie Adame, the sole proprietor, is considering delaying some of his December 2018 customer billings for lawn care into the next year. In addition, he is thinking about paying some of the bills in late December 2018, which he would ordinarily pay in January 2019. This way, Charlie claims, he will have “less income and more expenses, thereby paying less tax!”Is Charlie’s way of thinking acceptable?

  • Please read the article and answer about questions. You and the Law Business and law are...

    Please read the article and answer about questions. You and the Law Business and law are inseparable. For B-Money, the two predictably merged when he was negotiat- ing a deal for his tracks. At other times, the merger is unpredictable, like when your business faces an unexpected auto accident, product recall, or government regulation change. In either type of situation, when business owners know the law, they can better protect themselves and sometimes even avoid the problems completely. This chapter...

  • Read about Cokes strategy in Africa in the article below and discuss the ethics of selling...

    Read about Cokes strategy in Africa in the article below and discuss the ethics of selling soft drinks to very poor people. Is this an issue that a company like Coke should consider? Africa: Coke's Last Frontier Sales are flat in developed countries. For Coke to keep growing, Africa is it By Duane Stanford Piles of trash are burning outside the Mamakamau Shop in Uthiru, a suburb of Nairobi, Kenya. Sewage trickles by in an open trench. Across the street,...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT