Pharoah Corp.sells $6420 of goods on account in the current year and collects $3420 of this. It incurs $4200 in expenses on accountduring the current year and pays $2600 of them.Pharoah would report what amount of net income under the cash and accrual basesof accounting,respectively?

1. $2220 on the cash basis and $3000 on the accrual basis

2. $3000 on the cash basis and $2220 on the accrual basis

3. $820 on the cash basis and $2220 on the accrual basis

4. $3420 on the cash basis and $4200 on the accrual basis