Haskins and Jones, Attorneys-at-Law, maintains its books on a cash basis. During 2021, the law firm collected $640,000 for services rendered to its clients and paid out $431,000 in expenses. You are able to determine the following information about accounts receivable, prepaid expenses, deferred service revenue, and accrued liabilities: Accounts receivable Prepaid insurance Prepaid rent Deferred service revenue Accrued liabilities (for various expenses) In addition, 2021 depreciation expense on office equipment is $31,500. Required: Determine accrual basis net income for 2021. Cash basis income Add: Increase in deferred service revenue Decrease in accounts receivable Deduct: Answer is not complete. Accrual basis net income X X 2,300 X 5,000 X January 1, 2021 $ 81,000 6,400 11,100 11, 100 14, 100 ✓ $ 7,300 December 31, 2021 $76,000 8,300 9,000 13,400 18,900
Haskins and Jones, Attorneys-at-Law, maintains its books on a cash basis. During 2021, the law firm collected $640,000 for services rendered to its clients and paid out $431,000 in expenses. You are able to determine the following information about accounts receivable, prepaid expenses, deferred service revenue, and accrued liabilities: Accounts receivable Prepaid insurance Prepaid rent Deferred service revenue Accrued liabilities (for various expenses) In addition, 2021 depreciation expense on office equipment is $31,500. Required: Determine accrual basis net income for 2021. Cash basis income Add: Increase in deferred service revenue Decrease in accounts receivable Deduct: Answer is not complete. Accrual basis net income X X 2,300 X 5,000 X January 1, 2021 $ 81,000 6,400 11,100 11, 100 14, 100 ✓ $ 7,300 December 31, 2021 $76,000 8,300 9,000 13,400 18,900
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Topic Video
Question
100%
Not understanding the explanation provided, see image
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education