Ace Rentals Inc., an accrual-basis taxpayer, reported rent receivable of $35,000 and $25,000 in its 19X2 and 19X1 balance sheets, respectively.  During 19X2, Ace received $50,000 in rent payments and $5,000 in nonrefundable rent deposits.  In Ace's 19X2 corporate income tax return, what amount should Ace include as rent revenue?

The right answer should be $65000.

I just can't figure it out. why not $55000?

I was wondering if when it comes to caculate rent revenue on the tax return under accrual basis , we can just use the same way we compute it under financial accounting "BASE" rule. I am stuck.

Who can help me out? Thanks in advance.

yes , rent revenue will be calculated under accural basis.

beg bal 25k + sales 60k ( balancing figure) - ending bal. 35k = cash collected 50k.

and add nonrefundable rent also .