Question
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.
VAUGHN, M.D. Conversion of Cash Basis to Accrual Basis For the Year 2017Step by Step Solution
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