Solution-What was the company income before income taxes

What was the company income before income taxes

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Question - On April 1 Ivy Corp began operating a service company with an initial cash investment by shareholders of $1,000,000. The company provided $3,200,000 of services in April and received full payment in May. Ivy also incurred expenses of $1,500,000 in April that was paid in June. During May, Ivy paid its shareholders cash dividends of $500,000. What was the company's income before income taxes for the two months ended May 31 under the following methods of accounting?

	Cash Basis	Accrual Basis
a	$3,200,000	$1,700,000
b	$2,700,000	$1,200,000
c	$1,700,000	$1,700,000
d	$3,200,000	$1,200,000

Reference no: EM132074237

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What was the company income before income taxes

Reference no: EM132074237

Reference no: EM132074237

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