How each transaction would be handled using the cash basis

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Reference no: EM132805516

Academic Consultants Inc. had the following selected transactions in August 2016:

Aug.

1 Prepaid insurance for August through December, $1,000

4 Purchased software for cash, $800

5 Performed service and received cash, $900

8 Paid advertising expense, $300

11 Performed service on account, $3,000

19 Purchased computer on account, $1,600

24 Collected for the August 11 service

26 Paid account payable from August 19

29 Paid salary expense, $900

31 Adjusted for August insurance expense (see Aug 1)

31 Earned revenue of $800 that was collected in advance in July

Problem 1: Show how each transaction would be handled using the cash basis and the accrual basis. Under each column, give the amount of revenue or expense for August.

Reference no: EM132805516

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