Conan Industries collected $101,590 from customers in 2008. Of the amount collected,
$27,360 was from revenue earned on account in 2007. In addition, Conan earned $38,210 of revenue in 2008, which will not be collected until 2009.
Conan Industries also paid $71,530 for expenses in 2008. Of the amount paid, $30,210 was for expenses incurred on account in 2007. In addition, Conan incurred $42,580 of expenses in 2008, which will not be paid until 2009.
Instructions
(a) Compute 2008 cash-basis net income.
(b) Compute 2008 accrual-basis net income.