Question $2$

In its first year, a company performed services for a customer and billed the customer

$$14,000.$ In the second year, the customer pays the company for the services rendered in the

first year. In the first year, the company incurred $$6,000$ of wage expense, but it did not pay

the employees until the second year. If the company uses the cash$-$basis of accounting, then

it will report

revenue of $$14,000$ and expense of $$6,000$ in the second year.

revenue of $$14,000$ in the second year and expense of $$6,000$ in the first year.

revenue of $$14,000$ in the first year and expense of $$6,000$ in the second year.

revenue of $$14,000$ and expense of $$6,000$ in the first year.

no revenue and no expense in either year.