Your examination of the records of a company that follows the cash basis of accounting tells you that the company’s reported cash-basis earnings in 2022 are $37,007. If this firm had followed accrual-basis accounting practices, it would have reported the following year-end balances. 2022 2021Accounts receivable $3,740 $3,080Supplies on hand 1,430 1,603Unpaid wages owed 2,200 2,640Other unpaid expenses 1,540 1,210Determine the company’s net earnings on an accrual basis for 2022.Net earnings on an accrual basis for 2022

Accrual basis: Under this basis, the revenues are reported when they are earned irrespective of the…

Answered: Your examination of the records of a…

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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Your examination of the records of a company that follows the cash basis of accounting tells you that the company’s reported cash-basis earnings in 2022 are $37,007. If this firm had followed accrual-basis accounting practices, it would have reported the following year-end balances.

	2022	2021
Accounts receivable	$3,740	$3,080
Supplies on hand	1,430	1,603
Unpaid wages owed	2,200	2,640
Other unpaid expenses	1,540	1,210

Determine the company’s net earnings on an accrual basis for 2022.

Net earnings on an accrual basis for 2022

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