Reference no: EM131744364
Question: Splish Corp. maintains its financial records on the cash basis of accounting. Interested in securing a long-term loan from its regular bank, Splish Corp. requests you as its independent CPA to convert its cash-basis income statement data to the accrual basis. You are provided with the following summarized data covering 2016, 2017, and 2018. 2016 2017 2018
Cash receipts from sales:On 2016 sales $304,180 $165,290 $28,850
On 2017 sales -0- 365,210 87,710
On 2018 sales 404,040
Cash payments for expenses: On 2016 expenses 201,630 66,400 24,530
On 2017 expenses 38,310 a 164,520 55,920
On 2018 expenses 47,310 b 203,900
a. Prepayments of 2017 expenses.
b. Prepayments of 2018 expenses.
Using the data above, prepare abbreviated income statements for the years 2016 and 2017 on the cash basis.