Reference no: EM132670053

The Retry Company uses cash-basis accounting for their records. During 2020, Retry collected P500,000 from its customers, made payments of P200,000 to its suppliers for inventory, and paid P140,000 for operating costs. Retry wants to prepare an accrual-basis statements.

In gathering information for the accrual-basis financial statements, Retry discovered the following:

1. Customers owed Retry P50,000 at the beginning and P35,000 at the end of the year.
2. Retry owed suppliers P20,000 at the beginning and P27,000 at the end of the year.
3. Retry's beginning inventory was P42,000, and its ending inventory was P44,000. 
4. Retry had prepaid expenses of P5,000 at the beginning and P7,400 at the end of the year. 
5. Retry had accrued expenses of P12,000 at the beginning and P19,000 at the end of the year. 
6. Depreciation for the year was P51,000.

Problem 1: Determine the accrual basis net income of Retry Company for the year ended December 31, 2020.