Test Your Knowledge (1) Click & Discover Assume that Company XYZ had the following activities in its 2 nd month of business: Purchased 1500 units of product P from ABC Suppliers at $40// unit on account; account payable is due in 3 months. Sold 1000 units of product P at $100// unit, 300 units were sold for cash 700 units were sold on credit Salaries expenses of $20,000 accrued and paid. Paid I employee, Mr. Q, last month's salary of $3,000 (as Mr. Q. was away on sick leave and had not collected his pay). Compute: Cash basis income Accrual basis Net income & Cash basis balance sheet Accrual basis balance sheet