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, 2016, Bigham sold the following customer contracts:
Length of Contract 12 months and 24 months Total Proceeds $14,000 (12 months) $24,000 (24 months) (
Determine the income to be recognized in taxable income in 2016 and 2017.
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