A Company Maintains Its Records Using Cash-Basis Accounting

question 33

Essay

A company maintains its records using cash-basis accounting.During the year,the company received cash from customers,$34,000,and paid cash for taxes,$24,000.At the beginning of the year,customers owe the company $3,000.By the end of the year,customers owe $5,000.At the beginning of the year,the company owes taxes of $4,000.At the end of the year,the company owes taxes of $5,000.Determine cash-basis net income and accrual-basis net income for the year.

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Definitions:

Community Morals

Ethical standards and principles that are shared by and guide a community.

Autonomy Morals

Principles that emphasize the importance of self-governance and making decisions based on one’s own moral compass.

Homogenous

Having a uniform structure or composition throughout; similar in kind or nature.

Collectivistic

Characterizing cultures or societies that emphasize group goals and interdependence over individual pursuits and achievements.