Reference no: EM132994565

The Carly Company uses cash-basis accounting for their records. During the year, Carly collected P500,000 from its customers, made payments of P200,000 to its suppliers for inventory, and paid P140,000 for operating costs. Carly wants to prepare accrual-basis statements.

In gathering information for the accrual-basis financial statements, Carly discovered the following:

• Customers owed Carly P50,000 at the beginning and P35,000 at the end of the year.
• Carly owed suppliers P20,000 at the beginning and P27,000 at the end of the year.
• Carly's beginning inventory was P42,000, and its ending inventory was P44,000.
• Carly had prepaid expenses of P5,000 at the beginning and P7,400 at the end of the year.
• Carly had accrued expenses of P12,000 at the beginning and P19,000 at the end of the year.
• Depreciation for the year was P51,000.

Problem 1: Determine the accrual basis net income of Carly Company for the current year.