Kingman Consulting uses the cash basis of accounting and a fiscal year ending December 31.Beginning on September 1 2021 Kingman performs services for Renfro International at a rate of $5000 per month.On February 12 2022 Renfro pays Kingman $25000 in full for all services rendered from September 1 2021 to January 31 2022.Kingman understated accrual basis revenues by ________ on its year-end 2021 financial statement.

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Under the accrual basis, revenues are recognized when earned. Kingman earned $20,000 from September to December 2021 ($5,000 per month for 4 months), but since they use cash basis, they didn't recognize this revenue in 2021.

Kingman Consulting Uses the Cash Basis of Accounting and a Fiscal