2 group name members who participated b 8 points

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Group Name:___________________________________Members Who Participated:___________________________________________b.(8 points)Assuming the local McDonald’s operates on a calendar year-end under thecash method, what amount of net profit (loss) for the business was included in AGI for2016?ANSWERS:
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Group Name:___________________________________Members Who Participated:___________________________________________3. LMN Corporation received a service order for a $12,000 demolition from a customer on June30, 2016 and performed the demolition on July 31, 2016. The company sent the customer a billsaying they had to pay for the demolition no later than January 31, 2017. LMN Corporation usesa calendar year tax period. Based on phone calls with the customer in December of 2016, thecustomer explained that it may have to file bankruptcy proceedings, but was trying to work itsway out of financial hardship before taking that option. The customer said that at worst it wouldbe able to pay at least $9,000 of the bill. On January 15, 2017, LMN Corporation received acheck from the customer for $9,000 and was informed it would receive no additional payment. Inaddition to the transaction above, the following occurred:A different customer prepaid for a similar demolition service (for $12,000) onNovember 1, 2016 and scheduled the demolition for January 15, 2017. LMN Corphas not earned the income as of 12/31/16.The company both incurred and paid expenses for the following in 2016:oWages:$3,000oRental costs for a warehouse:$4,000oRepairs:$2,000

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Term
Fall
Professor
Staff
Tags
Method, DOM, FIFO and LIFO accounting, net profit, LMN Corp

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