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In its first year of operations, Roma Company reports the following. • Earned revenues of $45,000 ($37,000 cash received from customers). • Incurred expenses of $25,500 ($20,250 cash paid toward them). • Prepaid $6,750 cash for costs that will not be expensed until next year. Compute Roma's first-year net income under the cash basis and the accrual basis of accountin Revenues Expenses Net income. Cash Basis Accrual Basis

In its first year of operations, Roma Company reports the following. • Earned revenues of $45,000 ($37,000 cash received from customers). • Incurred expenses of $25,500 ($20,250 cash paid toward them). • Prepaid $6,750 cash for costs that will not be expensed until next year. Compute Roma's first-year net income under the cash basis and the accrual basis of accountin Revenues Expenses Net income. Cash Basis Accrual Basis

FINANCIAL ACCOUNTING
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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ok ht In its first year of operations, Roma Company reports the following. Earned revenues of $45,000 ($37,000 cash received from customers). • Incurred expenses of $25,500 ($20,250 cash paid toward them). • Prepaid $6,750 cash for costs that will not be expensed until next year. Compute Roma's first-year net income under the cash basis and the accrual basis of accountin Revenues Expenses Net income Cash Basis Accrual Basis
Transcribed Image Text:ok ht In its first year of operations, Roma Company reports the following. Earned revenues of $45,000 ($37,000 cash received from customers). • Incurred expenses of $25,500 ($20,250 cash paid toward them). • Prepaid $6,750 cash for costs that will not be expensed until next year. Compute Roma's first-year net income under the cash basis and the accrual basis of accountin Revenues Expenses Net income Cash Basis Accrual Basis
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