For the following scenarios, indicate how much of the following items of income and expense would be recognized in the current year if the taxpayer elects to file as a (1) cash basis taxpayer or (2) accrual basis taxpayer:

For the following scenarios, indicate how much of the following items of income and expense would be recognized in the current year if the taxpayer elects to file as a (1) cash basis taxpayer or (2) accrual basis taxpayer: Cash basis Accrual basis 1. On Dec 15 ABC paid $10,000 for utilities from 1/1 through 10/31 of the following year. 2. At year end, ABC estimates it will be unable to collect about S1,200 from customers for services completed this year. In addition, ABC is writing off receivables of $4,800 from Mr Jones. On 6/30, ABC paid $9,600 for the next 8 months of interest on a business loan On 10/1 ABC received $14,000 from a tenant who rents some excess warehouse space in a building owned by ABC. The $14,000 pays for 7 months' rent beginning 10/1 of the current year 4. 5. ABC sent a check to its insurance company for $12,000 on 6/30 of the current year. This $12,000 will cover the cost of ABC's insurance for 24 months beginning 7/1 of the current year ABC sent a check to its insurance company for $12,000 on 6/30 of the current year. This $12,000 will cover the cost of ABC's insurance for 12 months beginning 7/1 of the current year. On 11/1 ABC received a $4,000 down payment from a new customer for services to be provided by the company in March of the following year. ABC made $400 in campaign contributions this year to support Homer Simpson's gubematorial campaign. 6. 7. 8