Olaf Swensen carries on a business as a sole proprietor that delivers specialty food products to individuals and businesses. In 2021, the first year of business, he had total sales of $215,000, of which $85,000 were on account. In addition, he received $14,500 in advances from customers for products to be delivered in 2022. Olaf does not include advances in his total sales.

Olaf chooses a December 31 fiscal period for the business. On December 31, 2021, there are receivables of $42,000. He estimates that $4,000 of these receivables are doubtful of collection.

In 2022, Olaf's cash sales were $145,000 (not including advances from customers) and sales on account that total $92,000. The $14,500 of 2021 orders for which advances were received were all filled in 2022. In 2022, additional advances of $15,300 were received for deliveries in 2023.

In 2022, Olaf needed to write off $4,300 of the December 31, 2021, receivables as bad debts. On December 31, 2022, there are receivables of $38,000. Olaf anticipates that $4,500 of these receivables are doubtful of collection.

The December 31, 2022, receivables contain a single large order for $12,000 of Olaf's products sold to a very important customer. Because of the size of this order, Olaf has agreed to allow the customer to defer payment until January 1, 2023. The order was received on September 1, 2022.

Required:

How would the preceding information affect the calculation of Olaf Swensen's 2021 and 2022 business income? Include the full details of your calculations, not just the net result for each year.