Compare the cash and accrual methods of accounting for the following events: a. Purchased new equipment, paying

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Compare the cash and accrual methods of accounting for the following events:
a. Purchased new equipment, paying $50,000 cash and giving a note payable for $30,000 due next year.
b. Paid $3,600 for a three-year service contract on the new equipment.
c. Collected $1,800 for services to be provided over the current and following years.
d. Received a $3,000 note from a customer for services provided in the current year. The market value of the note was only $2,400.
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South Western Federal Taxation Individual Income Taxes 2017

ISBN: 9781305873988

40th Edition

Authors: William H. Hoffman, David M. Maloney, William A. Raabe, James C. Young, Nellen

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