Sheridan Corp. maintains its financial records on the cash basis of accounting. Interested in securing a long-term loan from its regular bank, Sheridan Corp. requests you as its independent CPA to convert its cash-basis income statement data to the accrual basis. You are provided with the following summarized data covering 2019, 2020, and 2021.

2019 2020 2021

Cash receipts from sales:

On 2019 sales $292,020 $163,350 $27,460

On 2020 sales -0- 385,180 96,310

On 2021 sales 373,280

Cash payments for expenses:

On 2019 expenses 181,360 65,930 26,670

On 2020 expenses 40,760 a 168,870 52,050

On 2021 expenses 49,420 b 220,490

a Prepayments of 2020 expenses.

b Prepayments of 2021 expenses.

Collapse question part

(a)

Correct answer. Your answer is correct.

Using the data above, abbreviated income statements for the years 2019 and 2020 on the cash basis. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

SHERIDAN CORP.

Income Statement (Cash Basis)

choose the accounting period Entry field with correct answer

For the Year Ended December 31,

2019 2020

Collapse question part

(b)

Using the data above, abbreviated income statements for the years 2019 and 2020 on the accrual basis. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

SHERIDAN CORP.

Income Statement (Accrual Basis)

choose the accounting period

2019

2020

select an income statement item

$enter a dollar amount

$enter a dollar amount

select an income statement item

enter a dollar amount

enter a dollar amount

select a closing income statement item

$enter a total net income or loss amount

$enter a total net income or loss amount