147 the mcnally company uses cash basis accounting for its records during 2015 mcnal 4313965

147 the mcnally company uses cash basis accounting for its records during 2015 mcnal 4313965

147.The McNally Company uses cash-basis accounting for its records. During 2015, McNally collected $500,000 from its customers, made payments of $200,000 to its suppliers for inventory, and paid $140,000 for operating costs. McNally wants to prepare accrual-basis financial statements. In gathering information for the accrual-basis financial statements, McNally discovered the following:

·

Customers owed McNally $35,000 at the beginning of 2015 and $50,000 at the end of 2015.

·

McNally owed suppliers $20,000 at the beginning of 2014 and $27,000 at the end of 2015.

·

McNally’s beginning inventory was $42,000, and its ending inventory was $44,000.

·

McNally had prepaid expenses of $5,000 at the beginning of 2015 and $7,400 at the end of 2014.

·

McNally had accrued expenses of $12,000 at the beginning of 2015 and $19,000 at the end of 2015.

·

Depreciation for 2015 was $51,000.

 

Required:
Prepare an accrual-basis income statement for 2015 for McNally Company.

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