Question - On December 31, Jayne Leigh completed her first year as a financial planner. The following data are available from her accounting records.
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Fees billed to clients for services rendered
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$98,000
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Rent expense for year just ended
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$10,800
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Cash received from clients
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84,000
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Utility expense incurred
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2,500
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Supplies purchased for cash
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4,400
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Utility bills paid
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2,200
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Supplies used during the year
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3,300
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Salary earned by assistant
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30,000
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Cash paid for rent (rent is paid through
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Salary paid to assistant
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27,500
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Feb. of next year)
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12,500
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a. Compute Leigh's net income for the year just ended using the accrual basis of accounting.
b. Compute Leigh's net income for the year just ended using the cash basis of accounting.