Firm B, a calendar year, cash basis taxpayer, leases lawn and garden equipment. During December, it received
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a. $522 repayment of a loan from an employee. Firm B loaned $500 to the employee six months ago, and the employee repaid the loan with interest.
b. $600 deposit from a customer who rented mechanical equipment. Firm B must return the entire deposit when the customer returns the undamaged equipment.
c. $10,000 short-term loan from a local bank. Firm B gave the bank a written note to repay the loan in one year at 5 percent interest.
d. $888 prepaid rent from the customer described in part b . The rent is $12 per day for the 74-day period from December 17 through February 28.
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Principles Of Taxation For Business And Investment Planning 2016 Edition
ISBN: 9781259549250
19th Edition
Authors: Sally Jones, Shelley Rhoades Catanach
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