Understanding the Cash versus Accrual basis Activity Le-Identifying Differences between Cash and Accrual Basi Read each scenario, decide whether the company is using Cash basis or Accrual basis, and then enter your answer to the question. The Purple Tulip Law Firm prepays for advertising in the local newspaper. On January 1, the law firm paid $1,660 for six months of advertising Purple Tulip Law Firm recorded $1,660 in the Prepaid Advertising account. Glossary HINT If Purple Tulp Law Firm had recorded their expenses using the other method, how much advertising expense would they have recorded for the two months ending February 287 Enter this value as a positive number. Safe Home provides house-sitting for people while they are away on vacation. Some of its customers pay immediately after the job is finished. Some customers ask that the business send them a bill. As of the end of the year, Safe Home has collected $1,900 from cash paying customers. Safe Home's remaining customers owe the business $2,840. Safe Home recorded $1,980 of service revenue for the year. Cashba it Safe Home had recorded their service revenue using the other method, how much service revenue would they have recorded f the year Marvelous Occasions received $220 for services to be performed for the next 8 months on March 31 and recorded this transaction using the Unearned Revenue account.