Carl's Catering Just Completed Its First Year of Operations

Essay

Carl's Catering just completed its first year of operations.During the year,the following events took place.
-Customer payments in the amount of $64,000 were received at the time the catering services were performed.
-Additional catering services totaling $35,000 were performed on account for customers; payments amounting to $6,000 were received from those customers.
-On the last day of the year,a local company paid $3,000 for catering services to be performed in 30 days.
-Employee wages totaled $25,000 and were paid in cash.
-The costs of food,beverages,and supplies used when catering services were performed amounted to $26,000 and were paid for in cash.(Note: Categorize these costs as "cost of goods sold.")
-Unpaid bills for delivery costs during the year amounted to $1,000 and were on hand at the end of the year.
-On the last day of the year,the company paid $12,000 in advance for rent on office space.
Required:
Part a.Determine the net income for Carl's Catering on a cash basis.
Part b.Determine the net income for Carl's Catering on an accrual basis.