[scothypnotist]

The income statement for the Edgebrook Golf Club Inc. for the month ended July 31
shows Green Fees Revenue $16,000; Salaries Expense $8,400; Maintenance Expense $2,500;
and Income Tax Expense $1,000. The statement of retained earnings shows an opening balance for
Retained Earnings of $20,000 and Dividends $1,000.

What is the retained earnings?

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In its first year of operations, Cope Company earned $28,000 in service revenue,
$6,000 of which was on account and still outstanding at year-end. The remaining
$22,000 was received in cash from customers.
The company incurred operating expenses of $15,500.
Of these expenses $13,000 were paid in cash; $2,500 was still owed on account
at year-end. In addition, Cope prepaid $2,600 for insurance coverage that would
not be used until the second year of operations.

(a)Calculate the first year's net earnings under the cash basis of accounting,
and calculate the first year's net earnings under the accrual basis of accounting.


?-Cash Basis $
?-Accrual Basis $

[morgaine300]

This should have been posted over in the homework forum. But either way, you need to read the guidelines for posting homework:
https://www.askmehelpdesk.com/financ...-b-u-font.html

[locsushi]

cash basic = 22,000 - 13,000 - 2,600 = 6,400
accrual basic = 28,000 - 15,500 = 12,500
Accrual Basic provide more useful information