Chapter 3 Homework Submit your answers in Canvas before it is due Use the following to answer questions 1-4 A company maintains its records using accrual basis accounting; however, their accountant wants to create a statement of cash flows and needs to determine the cash flow from operating activities. For simplicity, we assume only one expense account (salaries). The following is data gathered from their records. Services provided to customers during the period Salaries expense for the period Accounts receivable (beginning balance) Accounts receivable (ending balance) Salaries payable (beginning balance) $600,000 450,000 25,000 30,000 20,000 10,000 Salaries payable (ending balance) Complete the T-accounts for ACCOUNTS RECEIVABLE and SALARIES PAYABLE to help answer questions #1 &2. NOTE: ALL SERVICES PROVIDED ARE ON ACCOUNT AND SALARIES EXPENSE ARE RECORDED BEFORE THEY ARE PAID. ACCOUNTS RECEIVABLE SALARIES PAYABLE 1. Determine the amount of cash collected from customers during the period: $2 2. Determine the amount for cash paid for salaries during the period: $. 3. Determine accrual basis net income for the period: $ 4. Determine cash basis net income for the period: $ Use the following to answer questions 5-8 Determine the amount to recognize in May for accrual basis and for cash basis. 5 Provided $15,000 consulting services in May will be paid in June 6 In May paid $800 for office supplies and used $700 of supplies in May. 7 Paid workers $8,000 in May ($1,000 for work done in April and $7,000 for work done in May). 8 In May, paid $300 invoice for advertising done in May. Accrual basis Cash basis