QS 3-2 Computing accrual and cash income LO C1 In its first year of operations, Roma Company reports the following Earned revenues of $56,000 ($48,000 cash received from customers). Incurred expenses of $31,000 ($24,100 cash paid toward them). Prepaid $9,500 cash for costs that will not be expensed until next year. Compute the company's first-year net income under both the cash basis and the accrual basis of accounting. Cash Basis Accrual Basis $ 48,000 $ 56,000 Revenues Expenses Net income