connect Exercises E 1-1 Accrual accounting Listed below are several transactions that took place during the first two years of operations for the law firm Pete, Pete, and Roy . LO1-2 Year 1 Year 2 Amounts billed to clients for services rendered Cash collected from clients Cash disbursements $170,000 160,000 $220,000 190,000 Salaries paid to employees for services rendered during the year Utilities 90,000 30,000 60,000 100,000 40,000 Purchase of insurance policy In addition, you learn that the firm incurred utility costs of $35,000 in year 1, that there were no liabilities at the end of year 2, no anticipated bad debts on receivables, and that the insurance policy covers a three-year period