PQR Health Clinic provides medical services. Financial transactions for 2023 include:

Transactions (in $ millions)	Amount
Patient Service Revenue	70.0
Accounts Receivable	22.0
Cash Payments	42.0
Accounts Payable	18.0
Medical Supplies Purchases	25.0
Estimated Bad Debts	7.0

Requirements:

• Prepare PQR Health Clinic's income statement for 2023 using the modified cash basis.
• Calculate net income considering the conservatism principle.
• Discuss the impact of estimated bad debts on financial statements.
• Analyze the treatment of accounts receivable and medical supplies purchases under the conservatism principle.