Lake Corp., an accrual-basis calendar-year corporation, had the following Year 1 receipts: Year 2 advanced rental payments where the lease ends in Year 2 $125,000 Lease cancellation payment from a 5-year lease tenant 50,000 Lake had no restrictions on the use of the advanced rental payments and renders no services. What amount of income should Lake report on its Year 1 tax return?

Lake Corp., an accrual-basis calendar-year corporation, had the following Year 1 receipts: Year 2 advanced rental payments where the lease ends in Year 2 $125,000 Lease cancellation payment from a 5-year lease tenant 50,000 Lake had no restrictions on the use of the advanced rental payments and renders no services. What amount of income should Lake report on its Year 1 tax return?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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