Question

Masks, Inc reports the following:

Earned Revenue: $55,000 ($44,000 cash received)

Expenses: $38,000 ($32,000 paid toward them)

Prepaid Expense: $4,000 paid for expenses for next year

Net income under the cash basis of accounting is:

Masks, Inc reports the following: Earned Revenue: $55,000 ($44,000 cash received) Expenses: $38,000 ($32,000 paid toward them) Prepaid Expense: $4,000 paid for expenses for next year Net income under the cash basis of accounting is: Multiple Choice $17,000 $8,000 $13,000

Answer 1

Cash basis accounting Tevenue paid out. Cash basis accounting super to a major occounting method that recognizis and expenses at the time Cash is received cash basis accounting is accurate than accrual accounting • accrual accounting recognizes revenue is earned and record Expenses when it occured. less income at the time Calculation of met Income under the cash basis accounting revenue A Received in cash. (-) Expenses paid in Cash (o) prepaid expenses paid en Cash next year. $ 44000 ($32000) ($) for $80oo Answer Met income under cash. basis