During its first year, the company spent approximately $300,000 to catch 500 crocodiles. Of these, 300 crocodiles were sold and shipped to customers at a selling price of $1,000 per crocodile. Shipping costs of $50 per crocodile were paid for during the year. Customers were given liberal credit terms and only $160,000 from an equivalent 200 customers was collected during the first year. Ms. La Femme estimated that as much as 20% of the sales price will be spent in collection costs and bad debts expenses. Prepare three income statements for the year assuming that revenue is to be recognized when:

1. Crocodiles have been caught (i.e. production complete).

2. Crocodiles have been sold and delivered

3. Cash collections are complete

b. what income would you report for 2008? why? support your answer with reference to appropriate FASB's rules.