Al is a medical doctor who conducts his practice as a sole proprietor. During 2017, he received cash of $280,000 for medical services. Of the amount collected, $40,000 was for services provided in 2016. At the end of 2017, Al had accounts receivable of $60,000, all for services rendered in 2017. 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 2018. Compute Al’s gross income for 2017: a. Using the cash basis of accounting.
b. Using the accrual basis of accounting.
c. Advise Al on which method of accounting he should use.

a. Using the cash basis of accounting:

Cash received from customer          $280,000

Cash received for future service      $12,000

Total gross income                            $292,000

b. Using the accrual basis of accounting:

Service revenue = ($280,000 - $40,000 + 60,000) = $300,000

Gross income                                                                  $300,000

c) AI should use cash accural basis of accounting so that he will not have to pay income taxes on uncollected accounts receivable.

being born in poverty would limit the people's chances, opportunities and benefits.

this happen because of several things, such as:

- poor people tend to gain less access to good education and nutrition. this mean that their chance to obtain high paying jobs would also be limited.

- poor people tend to socialize with other poor people while the rich tend to socialize with other rich people. this means that simply throguh their social circle, rich people would have more business opportunities compared to the poor people.

- rich people tend to have more capital in their disposal. this would benefit them in business since it is far easier for them to fund their business operation compared to poor people.