(Classify the effect of economic events on income on the cash and accrual bases, LO 3, 6) Indicate whether each of the following events would be included in a calculation of net income on the cash basis, the accrual basis, or both:

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Economic Event Example: An entity sells merchandise for cash. a. An entity sells merchandise on credit. b. An entity collects cash for goods that were sold in a previous period. c. Inventory that was paid for in a previous period is sold in the current period. d. Inventory is paid for and sold in the current period. e. Inventory is purchased and paid for in the current period but is unsold as of the year end. f. A delivery vehicle is amortized. Net income on the cash basis Yes Net income on the accrual basis Yes