Exercise
Primo Industries collected $105,000 from customers in 2014. Of the amount collected, $25,000 was from services performed in 2013. In addition, Primo performed services worth $40,000 in 2014, which will not be collected until 2015.
Primo Industries also paid $72,000 for expenses In 2014. Of the amount paid, $30,000 was for expenses Incurred on account In 2013. In addition, Primo Incurred $42,000 of expenses in 2014, which will not be paid until 2015.
(a) Compute 2014 cash-basis net income.
Cash-basis net Income
(b) Compute 2014 accrual-basis net Income.
Accrual-basis net income