Listed below are several transactions that took place during the second and third years of operations for RPG Consulting.

	Year 2			Year 3
Amounts billed to customers for services rendered	$	440,000		$	540,000
Cash collected from credit customers		350,000			490,000
Cash disbursements:
Payment of rent		89,000			0
Salaries paid to employees for services rendered during the year		149,000			169,000
Travel and entertainment		39,000			49,000
Advertising		19,500			44,000

In addition, you learn that the company incurred advertising costs of $34,000 in year 2, owed the advertising agency $5,900 at the end of year 1, and there were no liabilities at the end of year 3. Also, there were no anticipated bad debts on receivables, and the rent payment was for a two-year period, year 2 and year 3.

Required:
1.	Calculate accrual net income for both years.

2.	Determine the amount due the advertising agency that would be shown as a liability on RPGs balance sheet at the end of year 2.