For tax purposes, under which of the following events would an accrual based taxpayer not accrue the income described Question options A calendar year franchisor is entitled to receive $3,000 per month plus 5 of the operating profits before taxes from one of its franchisees These payments are typically received by the 10 th day of the following month In a memo from the franchisee sent to the franchisor's controller at the end of December, the estimated amount of franchisee's net profit for the month of December was $110,000 A calendar year corporation's attorneys tell them at a year end meeting that a settlement conference is scheduled for January 10 th of the following year and they expect to receive a settlement offer between $3 and $5 million from litigation over economic damages An automobile dealer participates in the manufacturer's dealer rebate program for certain vehicle models sold The dealer sends the rebate materials and documentation to manufacturer at the end of the month and all rebates are approved All of the above accrual based taxpayers would accrue the described income

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Posted on Oct 01, 2024

For tax purposes, under which of the following events would an accrual-based taxpayer not accrue the income described?

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	A calendar year franchisor is entitled to receive $3,000 per month plus 5% of the operating profits before taxes from one of its franchisees. These payments are typically received by the 10^th day of the following month. In a memo from the franchisee sent to the franchisor's controller at the end of December, the estimated amount of franchisee's net profit for the month of December was $110,000.
	A calendar year corporation's attorneys tell them at a year-end meeting that a settlement conference is scheduled for January 10^th of the following year and they expect to receive a settlement offer between $3 and $5 million from litigation over economic damages.
	An automobile dealer participates in the manufacturer's dealer rebate program for certain vehicle models sold. The dealer sends the rebate materials and documentation to manufacturer at the end of the month and all rebates are approved.
	All of the above accrual based taxpayers would accrue the described income.