During 2011, ABC Company had credit sales of $40,000 and cash sales of $18,000.

In 2011 ABC collected $21,000 of accounts receivable resulting from sales on credit.

ABC incurred operating expenses of $7,500; of which $2,900 was paid in 2016, and the $4,600 balance represented a liability at year end.

In addition to these operating expenses, ABC also purchased a three year insurance policy for cash on January 1, 2011.

The cost of this policy was $3,000.

What is ABC's 2011 cash basis net income?

What is ABC's 2011 accrual basis net income?