Problem: R.E.M, a calendar-year corporation and Athens, Georgia band, recently sold tickets ($20,000,000) for concerts scheduled in the United States for next year and the following two years. For financial statement purposes, R.E.M will recognize the income from the ticket sales when it performs the concerts, and R.E.M is obligated to return the ticket payments should the concert be canceled. For tax purposes, R.E.M. uses the accrual method and would prefer to defer the income from the ticket sales until after the concerts are performed. This is the first time that it has sold tickets one or two years in advance.