How increases be added to or deducted from accrual basis

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Question 1: Kannah Co. wants to convert its year 1 financial statement from the accrual basis of accounting to the cash basis. Both supplies inventory and office payable increase between January 1, year 1, and December 31, year 1. To obtain year cash basis net income, how should these increases be added to or deducted from accrual basis net income

                                 Supplies inventory                Office salaries payable

a)                               Deducted                              Deducted

b)                              Deducted                               Added

c)                               Added                                     Added

d)                               Added                                      Added

Reference no: EM132483566

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