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Business, 21.11.2019 00:31 eyebang

Swan finance company, an accrual method taxpayer, requires all of its customers to carry credit life insurance. if a customer dies, the company receives from the insurance company the balance due on the customer's loan. ali, a customer, died owing swan $1,500. the balance due included $200 accrued interest that swan has included in income. when swan collects $1,500 from the insurance company, swan: a. must recognize $1,500 income from the life insurance proceeds. b. must recognize $1,300 income from the life insurance proceeds. c. does not recognize income because life insurance proceeds are tax-exempt. d. does not recognize income from the life insurance because the entire amount is a recovery of capital. e. none of these.

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Swan finance company, an accrual method taxpayer, requires all of its customers to carry credit life...

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