E4-1B Your examination of the records of a company that follows the cash basis of accounting tells you that the company’s reported cash basis earnings in 2010 are $33,640. If this firm had followed accrual basis accounting practices, it would have reported the following year-end balances.

2010 2009

Accounts receivable $3,400 $2,300

Supplies on hand 1,400 1,160

Unpaid wages owed 1,500 2,400

Other unpaid amounts 1,300 1,600

Instructions

Determine the company’s net earnings on an accrual basis for 2010. Show all your calculations in an orderly fashion.