Listed below are several transactions that took place during the second and third years of operations for RPG Company. Year 2 Year 3
Amounts billed to customers for services rendered $340,000 $440,000
Cash collected from credit customers 250,000 390,000
Cash disbursements:
Payment of rent 79,000 0
Salaries paid to employees for services rendered during the year 139,000 159,000
Travel and entertainment 29,000 39,000
Advertising 14,500 34,000

In addition, you learn that the company incurred advertising costs of $24,000 in year 2, owed the advertising agency $4,900 at the end of year 1, and there were no liabilities at the end of year 3. Also, there were no anticipated bad debts on receivables, and the rent payment was for a two-year period, year 2 and year 3.

Required:
Determine the amount due the advertising agency that would be shown as a liability on RPG’s balance sheet at the end of year 2.