What is the 481a adjustment for this change in accounting


Question: For 2016, Essence Company, a calendar year taxpayer, will change from using the cash method for tax purposes to the accrual method. At the end of 2015, Essence had the following items: Accounts receivable $472,300

Accounts payable 283,380

Bank loan 236,150

What is the § 481(a) adjustment for this change in accounting method? Indicate whether the adjustment is positive or negative. $ .

Essence will report this amount in its income equally over years beginning in.

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Accounting Basics: What is the 481a adjustment for this change in accounting
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