Listed below are several transactions that took place during the first two years of operations for the law firm of Pete, Pete, and Roy.

	Year 1			Year 2
Amounts billed to customers for services rendered	$	170,000		$	220,000
Cash collected from customers		160,000			190,000
Cash disbursements:
Salaries paid to employees for services rendered during the year		90,000			100,000
Utilities		30,000			40,000
Purchase of insurance policy		60,000			0

In addition, you learn that the company incurred utility costs of $35,000 in year 1, that there were no liabilities at the end of year 2, no anticipated bad debts on receivables, and that the insurance policy covers a three-year period.