Accounting Week 3 – Discussions

Get perfect grades by consistently using our writing services. Place your order and get a quality paper today. Take advantage of our current 20% discount by using the coupon code GET20

Order a Similar Paper Order a Different Paper

Answer the accounting questions… powerpoint provided. Presentation_ch03.pptx 

1. A business which uses the cash basis receives a computer from a customer in payment for a $2000 bill. Does the business have any recognizable income, since payment was received in a noncash form? Why? Also, what restrictions exist on which businesses can use the cash basis. Why do you believe these restrictions were imposed?

2. Explain the rules for discharge of indebtedness income. When is it taxable, and when isn’t it? Why? Do you think these rules make sense?

3. Cleveland Co. makes widgets. It has a commission salesman, Barnie, who does a wonderful job. Barnie sells tons and tons of widgets, and earns tons and tons of money as commissions on such sales. At the end of the year, Cleveland Co. sees how much money it made from Barnie’s sales, and out of gratitude for doing such a good job, makes a gift to Barnie of a brand new Buick Lesabre. Remember, Barnie was paid on commission, and already has been very handsomely rewarded by Cleveland Co. for the sales efforts he made, as he made a lot of commissions. Cleveland Co. did not have to also give him the car, and did it just out of admiration for Barnie doing such a great job. Is this income to Barnie as compensation, or a nontaxable gift?

4. Please comment on the doctrines of constructive receipt and assignment of income. What is each one all about? What do you think the purpose is of each one, what perceived abuses are each designed to counter?

Got stuck with another paper? We can help! Use our paper writing service to score better grades and meet your deadlines.

Get 15% discount for your first order

Order a Similar Paper Order a Different Paper