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Exercise 3-18 Vaughn, M.D., maintains the accounting records of Vaughn Clinic on a cash basis. During 2017, Dr. Vaughn collected $151,444 from his patients and

Exercise 3-18

Vaughn, M.D., maintains the accounting records of Vaughn Clinic on a cash basis. During 2017, Dr. Vaughn collected $151,444 from his patients and paid $58,747 in expenses. At January 1, 2017, and December 31, 2017, he had accounts receivable, unearned service revenue, accrued expenses, and prepaid expenses as follows. (All long-lived assets are rented.)

January 1, 2017

December 31, 2017

Accounts receivable $8,519 $14,894
Unearned service revenue 2,570 4,412
Accrued expenses 3,329 2,167
Prepaid expenses 1,915 3,507

Prepare a schedule that converts Dr. Vaughns "excess of cash collected over cash disbursed" for the year 2017 to net income on an accrual basis for the year 2017.

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VAUGHN, M.D. Conversion of Cash Basis to Accrual Basis For the Year 2017

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