Swordfish Co. earned $75,000 in 2018 and expects to receive 2/3 of the amount in 2019 and the remainder in 2020. How much revenue should Swordfish Co. report in 2018?

$75,000

Explanation:

Revenue is said to be earned on the deliver of the goods and services to the party that enjoys the benefits from the good or service.

As long as control of the goods has been transferred, the revenue is earned. Note that this is not when cash has been collected.

As such, if the company earned $75,000 in 2018 but some amounts are to be collected in subsequent years, the revenue earned in 2018 is still $75,000 while the amounts yet to be collected will be recognized in accounts receivable.

answertaxable income;