10. Listed below are several transactions that took place during the second and third years of operations for the RPG Company. Year 2Year 3Amounts billed to customers for services rendered$350,000 $450,000 Cash collected from credit customers 260,000 400,000 Cash disbursements: Payment of rent 80,000 0 Salaries paid to employees for services rendered during the year 140,000 160,000 Utilities 30,000 40,000 Advertising 15,000 35,000 In addition, you learn that the company incurred advertising costs of $25,000 in year 2, owed the advertising agency $5,000 at the end of year 1, and there were no liabilities at the end of year 3. Also, there were no anticipated bad debts on receivables, and the rent payment was for a two-year period, year 2 and year 3. Required:1. Calculate accrual net income for both years.2. Determine the amount due the advertising agency that would be shown as a liability on RPG's balance sheet at the end of year 2.Complete this question by entering your answers in the tabs below.Required 1Required 2Calculate accrual net income for both years.Year 2Year 3RevenuesExpenses:RentSalariesUtilitiesAdvertisingNet income< Required 1Required 2 > Required:1. Calculate accrual net income for both years.2. Determine the amount due the advertising agency that would be shown as a liability on RPG's balance sheet at the end of year 2.Complete this question by entering your answers in the tabs below.Required 1Required 2Determine the amount due the advertising agency that would be shown as a liability on RPG's balance sheet at the end ofyear 2.Advertising liability at end of Year 2< Required 1Required 2 >

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Description: 10. Listed below are several transactions that took place during the second and third years of operations for the RPG Company. Year 2Year 3Amounts billed to customers for services rendered$350,000 $450,000 Cash collected from credit customers 260,000

The income statement is prepared to record the revenues and expenses of the current period and…

Answered: 10. Listed below are several…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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10. Listed below are several transactions that took place during the second and third years of operations for the RPG Company.

	Year 2	Year 3
Amounts billed to customers for services rendered	$	350,000	$	450,000
Cash collected from credit customers		260,000		400,000
Cash disbursements:
Payment of rent		80,000		0
Salaries paid to employees for services rendered during the year		140,000		160,000
Utilities		30,000		40,000
Advertising		15,000		35,000

In addition, you learn that the company incurred advertising costs of $25,000 in year 2, owed the advertising agency $5,000 at the end of year 1, and there were no liabilities at the end of year 3. Also, there were no anticipated bad debts on receivables, and the rent payment was for a two-year period, year 2 and year 3.

Required:
1. Calculate accrual net income for both years.
2. Determine the amount due the advertising agency that would be shown as a liability on RPG's balance sheet at the end of year 2.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Calculate accrual net income for both years.
Year 2
Year 3
Revenues
Expenses:
Rent
Salaries
Utilities
Advertising
Net income
< Required 1
Required 2 >

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