On December 31, 2012, Ryan Stewart completed the first year of operations for his new computer retail store. The following data were obtained from the company€™s accounting records:

1. How much net income (loss) should Ryan report for the year ended December 31, 2012, according to
(a) Cash-basis accounting and
(b) Accrual-basis accounting?
2. Which basis of accounting provides the better measure of operating results forRyan?

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$75,000 Sales to customers Collections from customers Interest earned and received on savings S303,000 262,000 Wages paid to employee:s Ublity bill owed: to be paid next month Interest due at 12/3 on loan to be paid 3,500 152,000 170,000 5,500 1,750 2,400 36,000 in March of next year accounts Cost of goods sold Amounts paid to suppliers for inventory Wages owed to employees at year-end Amount paid for one and one-half years' rent, beginning Jan. 1, 2012 Income taxes owed at year-end 7,000