4. Answer the questions about accounting treatment.

1. Explain what are the differences if accrual or cash accounting is used to account for the following hypothetical situation (explain the concept using the matching principle and illustrate with numbers each accounting treatment): Marie went to City Hall to pay for the following: Booth Permit ($40.00), Cleaning deposit ($200.00) which refundable after the booth area is clean, City of Montreal Health Inspection fee ($150.00), and the Water, Drain, and Electricity connections and dismantle after the event ($200.00).

2. Explain what are the differences if accrual or cash accounting is used to account for the following hypothetical situation (explain the concept using the matching principle and illustrate with numbers each accounting treatment): At Pepsi Marie ordered on account a total of 100 cases of soft drinks, to be delivered half on Thursday and the other half on Saturday, for a $7.99 a case plus a $2.40 per case deposit.