Reference no: EM132513703
Cash versus accrual accounting:
Haskins and Jones, Attorney-at-Law, maintain its books on a cash basis. During 2018, the company collected $545,000 in fees from its clients and paid out $412,000 in expense. You are able to determine the following information about accounts receivable, prepaid expenses, deferred fee revenue, and accrued liabilities:
January 1, 2018 December 31, 2018
Accounts receivable $ 62,000 $ 55,000
Prepaid insurance 4,500 6,000
Prepaid rent 9,200 8,200
Deferred fee revenue 9,200 11,000
Accrued liabilities 12,200 15,600
- In addition, 2018 depreciation expense on office equipment is $22,000.
- Depreciation on the company's equipment is $10,000 for the year.
Required:
Question 1: What is the accrual basis net income for 2018.