Answer:
Cash basic net income
1
Db Cash_______________ 106000
Cr Revenue______________________ 106000
2
Db Expemses___________ 71700
Cr Cash_________________________ 71700
Accrual basic net income
1
Db Cash________________ 106000
Cr Account Receivable_____________ 25700
Cr Revenue_______________________ 80300
2
Db Account recerivable___ 41600
Cr Revenue______________________ 41600
3
Db Account payable______ 30800
Db Expenses___________ 40900
Cr Cash_________________________ 71700
4
Db Expenses__________ 43800
Cr Account payable_______________ 43800
Explanation:
The cash basis is a method of recording accounting transactions for revenue and expenses only when the corresponding cash is received or payments are made. Thus, you record revenue only when a customer pays for a billed product or service, and you record a payable only when it is paid by the company
Under the accrual basis of accounting (or accrual method of accounting), revenues are reported on the income statement when they are earned. When the revenues are earned but cash is not received, the asset accounts receivable will be recorded. (Under the cash basis of accounting, revenues are not reported on the income statement until the cash is received.)
Collected 106000 from customer in 2020
Collected 2019 25700 Services 2019
Collected 2020 80300 Services 2020
Services 2020 41600 collected in 2021
Paid 71700 expenses
Paid expenses 2019 30800 expenses 2019
Paid expenses 2020 40900 expenses 2020
Expenses 43800 Paid in 2021
