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Please see the attachment of assignment. Do you know these questions?

Refer to Case 21. Mr. Pitt has relented and agrees to provide you with the information necessary to convert his cash basis nancial statements to accrual basis statements. He provides you with the following transaction infonuatiou for the scal year ending December 3 l, 2013: l. A comprehensive insurance policy requires a payment every year for the upcoming year. The last payment of $12,000 was made on September I, 2013. 2. Mr. Pitt allows customers to pay using a credit card. t the end of the current year, various credit card companies owed Mr. Pitt $6,500. At the end of last year, customer credit card charges outstanding were $5,001 3. Employees are paid once a month, on the 10th of the month following the work period. Cash disbursements to employees were $3,200 and $1,200 for January 10, 2019, and January ll], 2013, respectively. 4. Utility bills outstanding totaled $1,200 at the end ofll and $9M at the end of 201?. 5. A physical count of inventory is always taken at the end of the scal year. The merchandise on hand at the end of2013 cost $35,030. At the end of 2011', inventory on hand cost $32,000. 6. At the end of 201?, Mr. Pitt did not have any bills outstanding to suppliers of merchandise. However, at the end of 201 E, he owed suppliers $4,000. Required: Mr. Pitt's 2013 cash basis net income (including depreciation expense] is $26,000. Determine net income applying the accrual accounting model. 1. Explain the effect on Mr. Pitt's bance sheet of converting from cash to accrual. That is, would assets, liabilities, and owner's equity be higher or lower and by what amounts?JI