During the month of August 2024, Clear view Tax Services, a tax-preparation service, had the following transactions: -Billed $400,000 in revenues on credit -Received $200,000 from customers' accounts receivable -Incurred expenses of $180,000, but only paid $90,000 cash for these expenses -Prepaid $30,000 for IT services to be used next month What was the company's accrual basis net income for the month? a) $220,000 b) $100,000 c) $190,000 d) None of the above
During the month of August 2024, Clear view Tax Services, a tax-preparation service, had the following transactions: -Billed $400,000 in revenues on credit -Received $200,000 from customers' accounts receivable -Incurred expenses of $180,000, but only paid $90,000 cash for these expenses -Prepaid $30,000 for IT services to be used next month What was the company's accrual basis net income for the month? a) $220,000 b) $100,000 c) $190,000 d) None of the above
Chapter16: Accounting Periods And Methods
Section: Chapter Questions
Problem 22CE
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Transcribed Image Text:During the month of August 2024, Clear view Tax Services, a tax-preparation service, had
the following transactions:
-Billed $400,000 in revenues on credit
-Received $200,000 from customers' accounts receivable
-Incurred expenses of $180,000, but only paid $90,000 cash for these
expenses
-Prepaid $30,000 for IT services to be used next month
What was the company's accrual basis net income for the month?
a) $220,000
b) $100,000
c) $190,000
d) None of the above
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