Reference no: EM132460261
Question 1 - Given the data below for a firm in its first year of operation, determine net income under the accrual basis of accounting.
Revenue recognized $19,000
Accounts receivable $3,000
Expenses incurred $7,250
Accounts Payable (related to expenses) $750
Supplies purchased with cash $1,800
a. 11,750
b. 14,000
c. $9,500
d. $12,200
Question 2 - What is La More's 20X1 net income using cash basis accounting?
La More Company had the following transactions during 20X1
Sales of $9,000 on account
Collected $4,000 for services to be performed in 20X2
Paid $2,650 cash in salaries
Purchased airline tickets for $500 in December for a trip to take place in 20X2
a. $10,350
b. $1,350
c. $9.850
d. $850