QUESTION 16

A tax file memorandum includes citations of tax law sources, whereas the client letter typically does not.

	a.	This statement is true.
	b.	This statement is false.

QUESTION 17

____________________taxpayer reports income as earned and deductions as incurred.

		a. A cash basis
		b. An accrual basis
		c. An individual
		d. A conservative

QUESTION 18

____________________taxpayer reports income as payments are received and deductions as payments are made.

		a. A cash basis
		b. An accrual basis
		c. An individual
		d. A conservative

QUESTION 19

Heathers interest and gains on investments for the current year are as follows:

Heather must include in her gross income:

	a.	$1,500.
	b.	$1,300.
	c.	$900.
	d.	$800.

• Interest income on Galloway Township, NJ bonds $600
• Interest income on U.S. government bonds $700
• Interest income on a savings account $200