Minutemen Law Services maintains its books using cash-basis accounting. However, the company decides to borrow $100,000 from a local bank, and the bank requires Minutemen to provide annual financial statements prepared using accrual-basis accounting as part of the creditworthiness verification. During 2015, the company records the following cash flows:

You are able to determine the following information:

Required:
Prepare an accrual-basis income statement for the year ended December 31, 2015, by calculating accrual-basis revenues andexpenses.

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Cash collected from customers $70,000 Cash paid for: Salaries Supplies Rent S36,000 4,000 5,000 7,000 3,000 Utilities 55,000 $15,000 Net cash flows January 1, 2015 December 31, 2015 Accounts Receivable Prepaid Insurance Supplies Salaries Payable $21,000 0- 5,000 2,700 $24,000 3,700 2,000 4,400