White Co. wants to convert its 2006 financial statements from the accrual basis of accounting to the cash basis. Both supplies inventory and office salaries payable increased between January 1, 2006, and December 31, 2006. To obtain 2006 cash basis net income, how should these increases be added to or deducted from accrual-basis net income?
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|
Supplies inventory |
Office salaries payable |
|
|
a. |
Deducted |
Deducted |
|
b. |
Deducted |
Added |
|
c. |
Added |
Deducted |
|
d. |
Added |
Added |