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E.Central MN | Yes, for example if you have the same inventory year end to year end, when the current year end's market price is higher than the previous year end's market price then your inventory increased which is taxable income even though you haven't sold the grain. Conversely, if the current year's value is lower than the previous year then you have a loss on inventory for tax purposes. Not a lot of things you can do about it under accrual because increases/decreases in prepaid expenses are also taxed the same way as inventory. | |
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Accrual accounting in ag
