elp Grammarly Tell me what you want to do 1 Normal 1 No Spot. Heading 1 Heading2TeSubtitle Subtle Em... Emphasis Intense E... Str Styles E4-5 Determine cash-basis and accrual-basis earnings (LO 1), AP In its first year of operations, Gomes Company recognized $28,000 in service revenue $6,000 of which was on account and still outstanding at year end. The remaining $22,000 was received in cash from customers. The company incurred operating expenses of $15,800. Of these expenses, $12.000 were paid in cash; $3,800 was still owed on account at year-end. In addition, Gomes prepaid $2.400 for insurance coverage that would not be used until the second year of operations. Instructions Calculate the first year's net earnings under the cash basis of accounting, and calculate the first year's net earnings under the accrual basis of accounting. Which basis of accounting (eash or accrual) provides more useful information for decision- makers? E4-10. Prepare adjusting entries. LO 2 3). AP Al Medina. D.D.S. opened an incorporated dental practice on January 1,2017. During the first month of operations, the following transactions occurred. 1performed services for patients who had dental plan insurance. At lanuary 31, S760 of such services was completed but not yet billed to the insurance companies. .2.Utility expenses incurred but not paid prior to january 31 totaled $450. .3.Purchased dental equipment on January 1 for $80,000, paying $20,000 in cash and signing a $60.0oo. 3-year note payable (interest is paid each December 30. The equipment depreciates $400 per month. Interest is s500 per month. 4.Purchased a 1 year malpractice insurance policy on January 1 for $24,000 . S Purchased $1.?50 of dental supplies (recorded as increase to Supplies). On January 31, determined that sss0 of supplies were on hand Instructions Prepare the adjusting entries on lanuary 31, Account titles are Aecumulat t Depreciation Expense. Service Revenue. Accounts Receivable. Insurance Expense, Interest Expense Interest Payable, Prepaid Insurance, Supplies. Supplies Expense, Utilities Expense and Accounts Payable