Uranium Mining Company, founded in 1982 to mine and market uranium, purchased a mine in 1983 for $900 million. It estimated that the uranium had a market value of $150 per ounce. By 2010, the market value had increased to $300 per ounce. Records for 2010 indicate the following:

Production .............. 200,000 ounces

Sales ............... 230,000 ounces

Deliveries .............. 190,000 ounces

Cash collection ............ 210,000 ounces

Costs of production including depletion* .$50,000,000

Selling expense ............ $ 2,000,000

Administrative expenses ........ $ 1,250,000

Tax rate ................ 50%

Required

a. Compute the income for 2010, using each of the following bases:

1. Receipt of cash

2. Point of sale

3. End of production

4. Based on delivery

b. Comment on when each of the methods should be used. Which method should Uranium Mining Company use?