In its first year of operations, Grace Company reports the following: Earned revenues of $60,000 (552,000 cash received from customers incurred expenses of $35,000 (531,000 cash paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. Net income under the accrual basis of accounting $13,000 $17.000 $25,000 $21,000