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Problem - 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, 2019, Bigham sold the following customer contracts:
Length of Contract
Total Proceeds
12 months
$14,000
24 months
$24,000
Required - Determine the income to be recognized in taxable income in 2019 and 2020.
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