1. Cash and Accrual Income LOI During 2010, Stacker Enterprises earned $55,000 from services provided and incurred $15,500 of expenses. At the end of the year, Stacker had received cash for $35,750 of the revenues and had paid $11,600 of the expenses. Also during 2010, Stacker received $3,500 cash for services to be performed in 2011 and paid $4,500 for rent for the first six months of 2011. Required Determine 2010 net income under (a) the cash basis and (b) the accrual basis of accounting.
1. Cash and Accrual Income LOI During 2010, Stacker Enterprises earned $55,000 from services provided and incurred $15,500 of expenses. At the end of the year, Stacker had received cash for $35,750 of the revenues and had paid $11,600 of the expenses. Also during 2010, Stacker received $3,500 cash for services to be performed in 2011 and paid $4,500 for rent for the first six months of 2011. Required Determine 2010 net income under (a) the cash basis and (b) the accrual basis of accounting.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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