E3-18B (Cash to Accrual Basis)

E3-18B (Cash to Accrual Basis) June Murray, M.D., maintains the accounting records of Murray Clinic
on a cash basis. During 2014, Dr. Murray collected $285,200 from her patients and paid $110,940 in expenses.
At January 1, 2014, and December 31, 2014, she had accounts receivable, unearned service revenue,
accrued expenses, and prepaid expenses as follows. All long-lived assets are rented.
January 1, 2014 December 31, 2014
Accounts receivable $18,500 $31,854
Unearned service revenue 5,680 8,222
Accrued expenses 6,870 4,216
Prepaid expenses 3,834 6,464
Instructions
Prepare a schedule that converts Dr. Murray‘s “excess of cash collected over cash disbursed” for the year
2014 to net income on an accrual basis for the year 2014.