1 answer

QUESTION 26 In its first year of operations. Grace Company reports the following: Earned revenues of...

Question:

QUESTION 26 In its first year of operations. Grace Company reports the following: Earned revenues of $60.000 (552,000 cash re

QUESTION 26 In its first year of operations. Grace Company reports the following: Earned revenues of $60.000 (552,000 cash received from customers): Incurred expenses of 535,000 1531.000 tash paid toward them Prepaid $8,000 cash for costs that will not be expensed until next year. Net income under the accrual basis of accounting is: A. 517.000 OB. 521,000 C 518,000. D.525,000 E. None of the answer choices is correct.

Answers

Calculate net income under accrual basis of accounting

Accrual basis of accounting includes revenue and expense for the period either in Cash or not

Revenue 60000
Expense -35000
Net income 25000

So answer is d) $25000

.

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