Reporting Cash Basis versus Accrual Basis Income
Skidmore Music Company had the following transactions in March:
a. Sold instruments to customers for $15,000; received $10,000 in cash and the rest on account. The cost of the instruments was $9,000.
b. Purchased $3,000 of new instruments inventory; paid $1,000 in cash and owed the rest on account.
c. Paid $750 in wages for the month.
d. Received $3,000 from customers as deposits on orders of new instruments to be sold to the customers in April.
e. Received a $200 bill for March utilities that will be paid in April. Complete the followingstatements:

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Accrual Basis Income Statement Cash Basis Income Statement Revenues Cash sales Customer deposits Expenses İnventory purchases Wages paid Revenues Sales to customers Expenses Cost of sales Wages expense Utilities expense Net income Net income