O'Brien Industries Collected $190,000 from Customers in 2018

Essay

O'Brien Industries collected $190,000 from customers in 2018. Of the amount collected, $40,000 was from revenue accrued from services performed in 2017, and $20,000 was received in advance for 2019 revenue. In addition, O'Brien earned $60,000 of revenue in 2018, which will not be collected until 2016. O'Brien also earned $25,000 of revenue in 2018 which had been collected in 2017.
O'Brien Industries paid $150,000 for expenses in 2018. Of the amount paid, $50,000 was for expenses incurred on account in 2017, $22,000 was paid in advance for 2019 expenses. In addition, O'Brien incurred $78,000 of expenses in 2018, which will not be paid until 2019. O'Brien also incurred $29,000 of expenses in 2018 which had been paid in 2017.
Instructions
(a) Compute 2018 cash-basis net income.
(b) Compute 2018 accrual-basis net income.