Bigham Corporation, an accrual basis calendar year taxpayer, sells its services under 12-month and 24-month contracts. The

Question:

Bigham Corporation, an accrual basis calendar year taxpayer, sells its services under 12-month and 24-month contracts. The corporation provides services to each customer every month. On July 1, 2017, Bigham sold the following customer contracts:

Length of Contract Total Proceeds
12 months ........................................... $14,000
24 months ........................................... $24,000

Determine the income to be recognized in taxable income in 2017 and 2018.

Length of Contract 12 months 24 months 2017 Income 2018 Income a. C. d. b.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...