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The ABC Partnership has grown significantly over the past five years. The partnership is considering...

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Accounting

The ABC Partnership has grown significantly over the past five years. The partnership is considering changing from the cash to accrual method of accounting. In their calculations for this accounting method change, ABCs accountants determine there would be a Section 481(a) adjustment of $100,000. In order to provide the least amount of impact to its taxable income, how much would the Section 481(a) adjustment impact ABC in year 1?
A. Increase in taxable income of $100,000
B. Increase in taxable income of $0
C. Increase in taxable income of $10,000
D. Increase ibn taxable income of $25,000

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