3A-2 (Similar to problem 3A-1) KATIE CONSULTING, Inc. had the following transactions in March: March 2. Received S1,700 cash for consulting. March 7. Purchased advertising for $390 cash. March 11. Did additional consulting for $3,700 on account. March 19. Purchased furniture for $3,200 on account. March 22. Paid salaries for the month of $4,000 cash. March 25. Received $8,000 in advance for a job to begin April 6. March 28. Collected $700 of the money owed from March 11. Required l. For each transaction, indicate the entry that would be made under cash basis accounting and then under accrual basis accounting. What would be the net income or loss for the month using the two different approaches? 2. Write a note to your banker explaining why accrual basis accounting would be a fairer representation of the performance of your company then cash basis. You may use as an example the problem above or the example provided at the beginning of this chapter. hapter 3 Section A