In its first year of operations, Roma Company reports the following:
Earned revenues of $63,000 ($55,000 cash received from customers).
Incurred expenses of $34,500 ($26,550 cash paid toward them).
Prepaid $11,250 cash for costs that will not be expensed until next year.
Compute the company's first-year net income under both the cash basis and the accrual basis of accounting.