ESSAY 1.Clearly distinguish between the cash basis of accounting measurement and the accrual basis of accounting measurement. 2.Ernesto obtained a contract to wash all the windows at...

ESSAY

1.Clearly distinguish between the cash basis of accounting measurement and the accrual basis of accounting measurement.

2.Ernesto obtained a contract to wash all the windows at Lynfield College at a price of $1,000 per month. During April, Ernesto washed all the windows but had collected only $800 by the end of the month. Also during April, Ernesto incurred $300 of expenses but had only paid $200 of these by month end.

If Ernesto uses accrual-basis accounting, what is net income for April? Carefully specify how you computed that amount and why.