can some help me answer option one by helping explain some facts of this case. and abalysis of tax law that can be applied?

should be 500-750 words and must include the following information: 1. Explanation of the taxpayer's business and issue at hand (heading: Facts). 2. Explanation of the IRS rules regarding the matter (also part of Facts). 3. Tax laws and applicable court cases to support the deductions, where applicable (heading: Analysis). 4. Conclusion as to the recommendations to the company (heading: Conclusion). The organization of the memo should present the headings in the following order:Facts. Conclusion; Analysis. The response should be formatted as a professional business memo to the client. Please save your assignment as a Word document with the filename: LastnameFirstinitial.ACC460.M.docx where the refers to Memo. Option 1 Problem: Adapted from 1.11-66 in the textbook. Sonny Corporation has never been audited before the current year. An audit is now needed by a CPA because the company is expanding rapidly and plans to issue stock to the public. A CPA firm has been doing preliminary evaluations of the Sonny Corporation's accounts and records. One major problem involves the valuation of inventory under GAAP. Sonny Corporation has been valuing its inventory under the cost method and no write downs have been made for obsolescence. A review of the inventory indicates that obsolescence and excess spare parts in the inventory are two major violations of Accounting Periods and Methods. The CPA states that for GAAP the company will be required to down its inventory by 25% of its stated amount, or $100,000, and charge this amount against net income from operations for the current period. Otherwise, an unqualified (ie, a "Clean opinion") will not be rendered. The company controller asks your advice regarding the tax consequences from the obsolescence and spare parts Inventory write down for the current year and the procedures for changing to the lower of cost-or-market (LCM) method for tax purposes. Sonny Corporation uses a calendar year for both book and tax purposes, and the date of your contact with the company is December of the current year. A partial list of research sources includes: 446 and 471 . Secs. 1.446-10), 1471-2 and 1.471-4 American Liberty Pipe Line Co. v. CIR, 32 AFTR 1099, 44-2 USTC 1008 (5th Cir. 194) Thor Power Tool Co. v. CIR, 43 AFTR 2d 79-362.79.1 USTC 99139 (USSC, 1979) Option 2 Problem 1:10-55 from the textbook (revised to include additional research) The Morris Corporation is a very successful and profitable manufacturing corporation. The corporation just completed leasehold improvements of its darth Mr Timor tan avid collector of artwork and should be 500-750 words and must include the following information: 1. Explanation of the taxpayer's business and issue at hand (heading: Facts). 2. Explanation of the IRS rules regarding the matter (also part of Facts). 3. Tax laws and applicable court cases to support the deductions, where applicable (heading: Analysis). 4. Conclusion as to the recommendations to the company (heading: Conclusion). The organization of the memo should present the headings in the following order:Facts. Conclusion; Analysis. The response should be formatted as a professional business memo to the client. Please save your assignment as a Word document with the filename: LastnameFirstinitial.ACC460.M.docx where the refers to Memo. Option 1 Problem: Adapted from 1.11-66 in the textbook. Sonny Corporation has never been audited before the current year. An audit is now needed by a CPA because the company is expanding rapidly and plans to issue stock to the public. A CPA firm has been doing preliminary evaluations of the Sonny Corporation's accounts and records. One major problem involves the valuation of inventory under GAAP. Sonny Corporation has been valuing its inventory under the cost method and no write downs have been made for obsolescence. A review of the inventory indicates that obsolescence and excess spare parts in the inventory are two major violations of Accounting Periods and Methods. The CPA states that for GAAP the company will be required to down its inventory by 25% of its stated amount, or $100,000, and charge this amount against net income from operations for the current period. Otherwise, an unqualified (ie, a "Clean opinion") will not be rendered. The company controller asks your advice regarding the tax consequences from the obsolescence and spare parts Inventory write down for the current year and the procedures for changing to the lower of cost-or-market (LCM) method for tax purposes. Sonny Corporation uses a calendar year for both book and tax purposes, and the date of your contact with the company is December of the current year. A partial list of research sources includes: 446 and 471 . Secs. 1.446-10), 1471-2 and 1.471-4 American Liberty Pipe Line Co. v. CIR, 32 AFTR 1099, 44-2 USTC 1008 (5th Cir. 194) Thor Power Tool Co. v. CIR, 43 AFTR 2d 79-362.79.1 USTC 99139 (USSC, 1979) Option 2 Problem 1:10-55 from the textbook (revised to include additional research) The Morris Corporation is a very successful and profitable manufacturing corporation. The corporation just completed leasehold improvements of its darth Mr Timor tan avid collector of artwork and