Arlene is a lawyer. She begins the current year with $12,000 in accounts receivable from customers. During

Question:

Arlene is a lawyer. She begins the current year with $12,000 in accounts receivable from customers. During the year, she bills customers $210,000 in fees and receives $180,000 in payments on account. She writes off $8,000 of the receivables as uncollectable, leaving her a year-end receivable balance of $34,000. What is Arlene’s gross income if

a. She uses the cash basis of accounting?

b. She uses the accrual basis of accounting?

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...