Pat's Custom Tuxedo Shop Maintains Its Records on the Cash

question 87

Multiple Choice

Pat's Custom Tuxedo Shop maintains its records on the cash basis. During this past year Pat's collected $42,000 in tailoring fees, and paid $14,000 in expenses. Depreciation expense totaled $2,000. Accounts receivable increased $1,500, supplies increased $4,000, and accrued liabilities increased $2,500. Pat's accrual basis net income would be:

• A)$18,000.
• B)$34,000.
• C)$23,000.
• D)$29,000.

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Definitions:

Open Innovation

The use of web-enabled input from external sources to facilitate innovation.

Intensive Collaboration

A deeply cooperative effort involving close and sustained interaction among participants to achieve a common goal.

External Parties

Individuals or organizations outside of an organization who can be affected by its activities or who can impact the organization's performance.

Open Innovation

A business model that encourages companies to both use external ideas and inventions in their own business practices and allow their unused internal ideas to be used by other organizations.