In its first year of operations, Cullumber Company recognized $$23,520$ in service revenue, $$5,040$ of which was on account and still outstanding at year$-$end. The remaining $$18,480$ was

received in cash from customers.

The company incurred operating expenses of $$13,272.$ Of these expenses, $$10,080$ were paid in cash; $$3,192$ was still owed on account at year$-$end. In addition, Cullumber prepaid

$$2,016$ for insurance coverage that would not be used until the second year of operations.

$($a$)$ 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.

Cash Basis

Net earnings

Accrual Basis

$

$($b$)$ Which basis of accounting $($cash or accrual$)$ provides more useful information for decision$-$makers?