In its cash flow statement for the current year, Ness Co. reported cash paid for interest of $70,000. Ness
did not capitalize any interest during the current year. Decreases occurred in several balance sheet
accounts as follows:
Accrued interest payable $17,000
Prepaid interest 23,000
In its income statement for the current year, what amount should Ness report as interest expense?
a. $30,000
b. $64,000
c. $76,000
d. $110,000

Correct answer C. I am confused about the conversion from cash basis to accrual basis. Somehow I was using X+23-17=70 ==>X=64£¨£Â£©£®£Ãan someone explain this to me? Thanks so much!