Greenthumbs Ltd opened a gardening consulting company on 1 August 2022 with each of the two owners contributing $20 000 cash. A one-year bank loan of $80 000 at 6 per cent per annum was obtained from the bank on 1 August, with principal and interest to be repaid at the end of the loan. An insurance policy for 12 months was taken out on 1 August 2022 for $600. Three months’ office rental for $900 was paid in advance on 1 August 2022. Consulting revenue of $12 000 was earned during the month, but $4000 had not been received at the end of August. A truck that cost $36 000 was paid for in cash on 1 August. It had an expected life of three years and zero residual value. Cash expenses during the month were: wages, $600;

other expenses, $400. Unpaid bills at month’s end were: electricity, $100; wages, $200.

Prepare an income statement for August 2022 under

(a) an accrual basis and

(b) a cash basis of accounting.