GreenUp a calendar year accrual basis taxpayer provides landscaping installation
GreenUp, a calendar year, accrual basis taxpayer, provides landscaping installation and maintenance services to its customers. In August 2015, GreenUp contracted with a university to renovate its lawns and gardens. GreenUp agreed to complete the entire renovation by May 31, 2017, and the university prepaid the entire $100,000 fee. GreenUp completed 20 percent of the work in 2015, 65 percent in 2016, and 15 percent in 2017.
a. How much revenue should GreenUp report on its financial statements for 2015, 2016, and 2017?
b. How much taxable income must GreenUp recognize in 2015, 2016, and 2017?
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