Show your work including calculations.(1 Suppose, revenue shown on the accrual basis income statement was $200,000. Accounts receivable were $5,000 on January 1, 2008 and $3,000 on December 31, 2008. During the year, we received $7,000 in advance of performing the services. These services will be performed next year in 2009. Can you show the computation of revenue for 2008 on cash basis?(2 Here’s another exercise, this time in the opposite direction. This one may be a little more challenging. Expenses paid during 2008 were $80,000. Expenses paid in advance were $4,000 as at December 31, 2007, and the balance of expenses paid in advance was $8,000 as at December 31, 2008. Expensens accrued and still unpaid were $6,000 as at December 31, 2007, and $9,000 as at December 31, 2008. Can you show the computation of expenses on the accrual basis for the year 2008?(3 Why is it necessary to use the Time Period assumption? The best way to judge a business’ profit is to compare the initial investment amount with the amount received at the time of the liquidation of the business…isn’t it? 🙂 Then why the time period assumption? Anybody??