Rhynie Corporation uses the accrual method of accounting. Rhynie's sole shareholder, Austen, uses the cash method of accounting. Both taxpayers use the calendar year as their tax year. The corporation accrues a $25,000 interest payment to Austen on December of the current year and makes the payment on March 10 of the next year.

What are the tax consequences of the transactions to both taxpayers in the current year and next year? Explain your answer.