Activity 1.c-Identifying Differences between Cash and Accrual Basis Read each scenario, decide whether the company is using Cash basis or Accrual basis, and then enter your answer to the question. The Purple Tulip Law Firm prepays for advertising in the local newspaper. On January 1, the law firm paid $3,770 for six months of advertising. Purple Tulip Law Firm recorded $3,770 in the Prepaid Advertising account. Accrual basis If Purple Tulip Law Firm had recorded their expenses using the other method, how much advertising expense would they have recorded for the two months ending February 287 Enter this value as a positive number. $1256 Seashore Home provides house-sitting for people while they are away on vacation. Some of its customers pay immediately after the job is finished. Some customers ask that the business send them a bill. As of the end of the year, Seashore Home has collected $2,090 from cash-paying customers. Seashore Home's remaining customers owe the business $1,340. Seashore Home recorded $2,090 of service revenue for the year. Cash bas if Seashore Home had recorded their service revenue using the other method, how much service revenue would they have recorded for the year? $750 Splendid Occasions received $1,190 for services to be performed for the next 8 months on March 31 and recorded this transaction using the Unearned Revenue account Accrual basis If Splendid Occasions had recorded their service revenue using the other method, how much service revenue would they have recorded for the year? Sweet Catering completed the following selected transactions during May 2016: May 1: Prepaid rent for three months, $2,400 May 5: Received and paid electricity bill, 580 May 9: Received cash for meals served to customers, $2,420) May 14: Paid cash for kitchen equipment, $3,480 May 23: Served a banquet on account, $1,8701 May 31: Made the adjusting entry for rent (from May 1). May 31: Accrued salary expense, $50 May 31: Recorded depreciation for May on kitchen equipment. $100 If Sweet Catering had recorded transactions using the Cash method, how much net income (loss) would they have recorded for the month of May? if there is a loss, enter it with parentheses or a negative sign If Sweet Catering had recorded transactions using the Accrual method, how much net income (loss) would they have recorded for the month of May? if there is a loss, enter it with parentheses or a negative sign