Bud Ace, a selfemployed carpenter, reports his income on the cash basis. During the current year he completed a job for a customer and sent him a bill for $3,000. The customer was not satisfied with the work and indicated that he would only pay $1,500. Ace agreed to reduce the bill to $2,000 but before payment was made the customer died. Ace could not collect from the customer's estate and should treat this loss as ?

Answer rating: 100% (QA)

Since Bud Ace is reporting his income on the cash basis he recognizes income ... View the full answer