11/28/22
Accrual vs. Cash-Basis
During 2021, Any Company billed its client for $50,000. On December 31, 2021, it had received $47,000, with the remaining $3,000 to be received in 2022. Total expenses during 2021 were $32,000 with $4,000 of these costs not yet paid at December 31. Determine net income under both methods.
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Accrual vs. Cash-Basis
Cash-Basis Accounting Cash receipts $47,000 Cash disbursement 28,000 Income $19,000
Accrual-Basis Accounting Revenues earned $48,000 Expenses incurred $32,000 Income $16,000
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