THE TAXPAYER HAS CONSISTENTLY BUT INCORRECTLY, USED AN ALLOWANCE FOR BAD DEBTS. AT THE BEGINNING OF THE YEAR, THE BALLANCE IN THE ALLOWANCE ACCOUNT...

THE TAXPAYER HAS CONSISTENTLY BUT INCORRECTLY, USED AN ALLOWANCE FOR BAD DEBTS. AT THE BEGINNING OF THE YEAR, THE BALLANCE IN THE ALLOWANCE ACCOUNT IS 90,000.a. if the IRS examines the taxpayer's tax return and requires the taxpayer to change accounting methods, the taxpayer will be required to recognize an additional 90,000 of income ( one half in the current year and one half in the following year) as the adjustment due to the change in accounting methods.b if the taxpayer voluntarily changes methods, the 90000 adjustment can be spread over the current and three following years.c. if the taxpayer voluntarily changes methods, the 90000 reserve can be used to absorb bad debts until the account balance is zero.d. if the IRS examines the taxpayer's return, no adjustment to the reserve account will be required if the balance is consistent with prior bad debt experience.e. none of the above