12.During 2016 a company makes credit sales of $650,000, of which $450,000 is collected at year end. It pays $250,000 in expenses, reduces prepaid expenses by $50,000 and owes $25,000 for gas used during 2016.

Accrual Profit is:

A.$400,000

B.$325,000

C.$375,000

D.$175,000

E.None of the above

13.What would be the profit if cash accounting rather than accrual accounting was used, in question 14 above?

A.$200,000

B.$175,000

C.$375,000

D.$425,000

E.None of the above