Read Problem Chapter 1-86. Draft a memo as if you were the tax advisor for R.E.M. Answer his question and provide some advice on any action he can take. Attach your memo as a Word document to your response. If your memo requires any supporting schedules We suggest you prepare in excel and cut and paste from excel to word, paste as a Bitmap.

1-86. R.E.M., a calendar-year corporation and Athens, Georgia, band, recently sold tickets ($20,000,000) for concerts scheduled in the United States for next year and the following year. For financial statement purposes, R.E.M. will recognize the income from the ticket sales when it performs the concerts. For tax purposes, it uses the accrual method and would prefer to defer the income from the ticket sales until after the concerts are performed. This is the first time that it has sold tickets one or two years in advance. Michael Stipe has asked your advice. Write a memo to Michael explaining your findings.