Chuck corporation began operating a new retail business in

Reference no: EM13576064

Chuck Corporation began operating a new retail business in the current year and had $500,000 of sales, $70,000 of which had not been collectedby year-end. Total purchases were $350,000 on which $30,000 is still owed. Ending inventory is $60,000; operating expenses are $17,000, $50,000 of which is still owed at years-end.

a. Compute net income from the business under accrual method.

b. Compute net income from the business under the cash method.

c. Would paying the $50,000 he ows for operating expenses before year-end change her net income under the accrual method?

Under the cash method?

Reference no: EM13576064

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