Ihave very little cash and yet he says that i had a good year with $15,000 net income. he said it was because we use accrual accounting (whatever that means). i know i paid 6 month’s rent ($1,400 a month) in advance at the end of the year. i also paid my insurance for the next year. insurance cost $6,000. i have several customers who had a lot of services done on credit and haven’t paid yet. i think that totals $11,948 owed to me. can you explain?

Step-by-step explanation:

Accrual - the accumulation or increase of something over time, especially payments or benefits.

(Accumulation Accounting)

Net Income: $15,000

Spent: 6($1,400)+$6,000

$8,400+$6,000 = $14,400

Current Total (In-hand): $600

Not Been Paid Yet (Not In-hand): $11,948

step-by-step explanation:

12: 00 p.m. to 7: 00 p.m. is a total of 7 hours.

4: 00 p.m. to 7: 00 p.m. is a total of 3 hours.

this means that from 4: 00 p.m to 7: 00 p.m. this represents 3/7 of what was lost from 12: 00 p.m. to 7: 00 p.m.

after knowing this, after doing 11,600 - 6,800 = 4,800

4,800 represents 3/7 of what was lost for 7 hours.

we then divide 4,800 by 3 which gets 1,600.

because we know that 1,600 represents 1/7 of how much water was lost, we just have to multiply by 7, which gets 11,200.   after adding 11,200 to how much water was left at 7: 00 p.m. which was 6,800. 11,200 + 6,800 = 18,000

this means that the pool originally had 18,000 gallons in the pool.

you can also check your work by doing 18,000 - 4(1600), which becomes           1800 - 6400 which gets you 11,600.