[crash08]

Hey guys, I'm new here and would really appreciate it if someone helps me out

Company X employs several consulting companies. Some of the companies require pmt in advance whiel others bill company x after service is rendered.

Company X also leases office space to several law firms. Some firms are required to pay rent in advance whiel others are allowed to use their office before paying rent.

Company X uses accrual basis accounting.
Amount of cash paid to consulting companies during 2000 was $64,000
Amount of rent revenue earned from leasing office space was $78,000

Following info is given:

Dec. 31,1999 Dec. 31,2000
Prepaid consulting fees $2000 $5000
Accured consulting fees payable $7000 $2000
rent receivable $6000 $8000
unearned rent revenue $10,000 $4000

A) Compute the amount of consulting expense for 2000
B)Compute the amount of cash received from leasing office space during 2000

Can someone please help get started with this problem? I've never been asked problems
in this fashion till this semester. Any help would be greatly appreciated.

[crash08]

Here's my thoughts for part A

Paid $64,000 in consulting fees during 2000
However they had $2000 in prepaids ending 1999 and carried over to 2000. So they used 2000 in prepaids

They also paid/reduced their paypable account from 7000 to 2000; difference of 5000

64,000
(2000)
5000
-------
$67,000 in expense.

I'm not really sure if that makes sense or not. Hopefully you guys will chime in and help me out. Thanks!