Advise Al on which method of accounting he should use

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Question - Al is a medical doctor who conducts his practice as a sole proprietor. During 2020, he received cash of $280,000 for medical services. Of the amount collected, $40,000 was for services provided in 2019. At the end of 2020, Al had accounts receivable of $60,000, all for services rendered in 2020. In addition, at the end of the year, Al received $12,000 as an advance payment from a health maintenance organization (HMO) for services to be rendered in 2021. Compute Al's gross income for 2020. Advise Al on which method of accounting he should use.

Reference no: EM132942479

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