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Schlude, who is on the accrual basis of accounting for taxes, operates a dance studio. In August 1952 he enters into a contract with a student to teach 24 one-hour lessons in return for $240, $100 down in cash and $20 a month for the next 7 months. Lessons are arranged from time to time and the studio has given the student 10 lessons at the end of 1952 and the student has paid $180 by the end of 1952. ($100 down payment and 4 installments of $20.). By March 1953, the studio has given the student 10 more lessons and the student has paid $40 additional beyond what was paid in 1952 (2 more installment payments were made in 1953). The student then loses interest and receives no more lessons and makes no more payments. For questions 1 and 2, please provide simplified journal entries that show the different positions taken by the taxpayer and tbe IRS. It is not necessary to schedule out the details of the transactions. What is needed is to show the income reported for 1952 and 1953 under question 1 for the taxpayer and the income reported for 1952 and 1953 under question 2 by the IRS. 1. What journal entry did Schlude use in 1952 and 1953 to use to record the transactions? 2. How would the IRS journalize the transactions for 1952 and 1953? Schlude, who is on the accrual basis of accounting for taxes, operates a dance studio. In August 1952 he enters into a contract with a student to teach 24 one-hour lessons in return for $240, $100 down in cash and $20 a month for the next 7 months. Lessons are arranged from time to time and the studio has given the student 10 lessons at the end of 1952 and the student has paid $180 by the end of 1952. ($100 down payment and 4 installments of $20.). By March 1953, the studio has given the student 10 more lessons and the student has paid $40 additional beyond what was paid in 1952 (2 more installment payments were made in 1953). The student then loses interest and receives no more lessons and makes no more payments. For questions 1 and 2, please provide simplified journal entries that show the different positions taken by the taxpayer and tbe IRS. It is not necessary to schedule out the details of the transactions. What is needed is to show the income reported for 1952 and 1953 under question 1 for the taxpayer and the income reported for 1952 and 1953 under question 2 by the IRS. 1. What journal entry did Schlude use in 1952 and 1953 to use to record the transactions? 2. How would the IRS journalize the transactions for 1952 and 1953

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