which of the following statements is true of revenues

a. 6. an internal document that helps summarize data for the preparation of financial statements is called a __________. Prepare the adjusting entry. A (5) The aging method is closely related to the, (5) The percentage of credit sales approach is closely related to the, (5) The process by which firms package factored receivables as financial instruments or securities and sell them to investors is known as. A Green Lawns Corporation earned $500 for landscaping services rendered. D Meadows Manufacturing follows the accrual basis. Using Minitab or Excel, develop a quadratic trend equation that can be used to 24. 8. Revenue is recorded in the accounting records when the cash is received from a customer and reported on the income statement when sold to the customer. (Enter one word per blank.). Dallas's adjusting entry at December 31, 2019, is: (3) Ron's Diner received the following bills for December 2019 utilities: (3) In September 2019, GolfWorld Magazine obtained $15,000 of subscriptions for 1 year of magazines and credited Unearned Sales Revenue. Selected year-end financial statements of Cabot Corporation follow. When an obligation is incurred that will be paid from current financial resources. $$ d. If revenues are greater than expenses, the company has net income and retained earnings decreases In late August, a company provided one of its customers with services worth $500; however, the company did not send the customer a bill for those services until early September. FF A Adjusting entries are necessary because timing differences exist between when a revenue or expense is recognized and cash is received or paid. accrual-basis accounting and GAAP demand that Fine recognize all revenue related to the project in January. a. Arise from interfund transfers out. LP principal amount plus interest due at maturity. Local government is a generic term for the lowest tiers of public administration within a particular sovereign state.This particular usage of the word government refers specifically to a level of administration that is both geographically localised and has limited powers. C A \text{Assets} & \quad & \text{Liabilities and Equity}\\ Interest Payable $137.50 6. An adjusting entry for accrued expenses involves: (Select all that apply.). D c. Budgetary Fund Balance. D While in some countries, "government" is normally reserved purely for a national administration (government) (which may be . If an adjusting entry's debit is to an expense account, then the credit must be to which of the following? c. The Actual column is required to be presented using the government's budgetary basis of accounting. The adjusting entry for a prepaid expense includes a debit to a(n) ______ account and a credit to a(n) ____ account. B InterCo) assets and liabilities, equity, income, expenses and cash flows not forgetting that "profits or losses . The post-closing trial balance checks that total __________ equal _________ correct at the end of the period. March 31 falls on a Tuesday for the current year. Environmental protection. Contracts need to be in written form to be considered under ASC Topic 606. c. No consideration can be received before a contract exists. Which of the following statements about revenue is correct? Which two accounts would be most at risk? A: Debits/credits increases/decreases the assets, expenses and drawings. which of the following inventory costing methods results in the highest value of ending inventory during a period of rising inventory costs? B Andy records an adjusting entry for deferred revenue. $8,000 of revenue and $600 of expense. B D Suppose that a company did not make an adjusting entry to record revenue earned but not yet billed to customers. $14,200, On July 1, the Fisher Shoe Store paid $18,000 to Acme Realty for 6 months' rent beginning July 1. A A. A G add the company's net income for March to the company's retained earnings as of March 1. Record Revenues that were received in cash in an earlier period. Debit Notes Payable $12,420 D in a perpetual inventory system, the physical count of inventory ____________. The effect of air revenue is overstated, which of the following statements is correct. cash-basis; April. Although not true revenues, sections are also included for: J. Interdepartmental Revenues K. External Organization Income . The adjusted trial balance lists only the balance sheet accounts in a "debit" and "credit" format. \text{CABOT CORPORATION Income Statement For Year Ended December 31, 2017}\\ Technology companies are particularly dependent on offshore revenue. M If the annual premium is $924, find the amounts of the three payments. B) represent one distinct performance obligation. C) depreciation is recorded on all plant assets. CS C Transcribed image text: Which of the following statements is true? (5) When is revenue from the sale of merchandise normally recognized? (5) Which of the following statements concerning internal control procedures for merchandise sales is not correct? A Conceptually, when should Food To Go recognize revenue from its catering service? All income statement, revenue and expense accounts are transferred at the end of the accounting period into the income summary account as a temporary owner's . B ), Adjusting entries are made at the __________ of the accounting period, while daily transactions are made throughout the accounting period. Amounts paid out as dividends are not expenses. On November 1, 2019, Movers, Inc., paid $24,000 for 2 years' rent beginning on November 1. A) Revenues decrease owner s equity, so a revenue account's normal balance is a credit balance. Salaries and Wages Expense and Salaries and Wages Payable Credit Cash $12,420 A On November 15, Fine Flooring begins to install new carpet throughout Prime Publishing's corporate headquarters. Journalize the entry to accrue interest on December 31st, 2022. Adjusting entries help to ensure that all ______ are recorded in the period in which they are incurred. ENGLEWOOD, Colo.--(BUSINESS WIRE)-- Qurate Retail, Inc. ("Qurate Retail") (Nasdaq: QRTEA, QRTEB, QRTEP) today reported fourth quarter and year end 2022 results (1). preparing all deferral entries. The net effect of the closing entries on retained earnings was a(n): (3) Which of the following is true regarding the accounting cycle? . 5. Which of the following statements is true for other financing uses but is not true for expenditures? -Revenues are the amounts a business charges its customers for services it provides or goods it sells to them. D Negative externalities c. Resource immobility. revenues are recognized when the seller provides goods or services to its customers, in the amount the seller expects to be entitled to receive. A ), On November 1, 2019, Movers, Inc., paid $24,000 for 2 years' rent beginning on November 1 (assume rent is the same amount each month). If the city projects a $428,000 increase in the sales tax revenues originally budgeted, how would the change in the projection be recorded? When the customer takes possession of the merchandise, if sold for cash, or when payment is received, if sold on credit. Which of the following is true about closing entries: a. What effect will these errors have on Unique's balance sheet for the month, assuming all other account balances listed on that sheet are correct? The first payment is 40% of the annual premium, and each of the next two payments is 30% of the annual premium. A B D) require the company to allocate the transaction price to each performance obligation. Credit Cash $12,840 9. (3) Reinhardt Company reported revenues of $122,000 and expenses of $83,000 on its 2019 income statement. overstated; $1,725. gross profit, operating income, net income. (Select all that apply. 5. A. Neverthe gross method should always be used. The accounting basis that records revenues in the period that goods and services are provided to customers is referred to as. This would also be apparent from section 132(4). Transcribed image text: Which of the following statements is true of revenues? Which of the following statements is not true? (3) Which transaction would require adjustment at December 31? (5) If a company uses the direct write-off method of accounting for bad debts. Which of the following is an adjusting entry that should be made by the company? What is free cash flow, and how is it computed. D) Revenues . A Investment earnings restricted for art preservation. A company that uses accrual-basis accounting purchased equipment on July 1 of the current year for $20,000. The employees of Leichester Services, Inc. worked the last two weeks of December, 2016. $5,000 record it in its books but will not recognize it as an expense unless it files a claim against the insurance company and receives a benefit. A resolving all errors in the unadjusted trial balance. An accrual results when ____________ and a deferral results when 2. b. c. Generally accepted accounting principles require companies to use cash-basis accounting. debit Supplies $900; credit Supplies Expense, $900 C D) Revenues increase equity, so a revenue account's normal balance is a credit balance. C debit Supplies $2,500; credit Supplies Expense $2,500. C The accrual basis of accounting ignores the timing of cash receipts and cash . On December 31, 2019, Reinhardt prepared closing entries. A) on the balance sheet and income statement, respectively. which of the following accounts decreases with a credit? A. Then solve it using the simplex method. 4. Which of the following statements is TRUE of revenues? c. If revenues are less than expenses, the company has a net loss and contributed capital increases to balance off the loss. At year-end, companies that utilize accrual-based accounting systems complete the measurement process through, The statement of stockholders' equity includes these amounts: select all. C \text{Merchandise inventory} \ldots\ldots\ldots & \text{32,150} & \text{Common stock}\ldots\ldots\ldots & \text{90,000}\\ a. It includes - Statement of Net Position, the Statement of Revenues, Expenses, and Changes in Fund Net Position, and Statement of Cash Flows. Debit Interest Expense 280 Which of the following is true of a partnership? Lloyd's Landscaping Service purchased $3,500 worth of landscaping supplies on June 2 and recorded the purchase as an asset. 2. What amount will be shown for prepaid rent on the December 31, 2020 balance sheet? Payment was received on January 21 of the following year. Operating grants that can be used at the discretion of the city council. D Accrual-basis accounting is optional under . d. DR - Fund Balance $428,000; CR - Revenue $428,000, b. DR - Estimated Revenue $428,000; CR - Budgetary Fund Balance $428,000. B. (All sales were on credit; selected balance sheet amounts at December 31, 2016, were inventory, $48,900; total assets,$189,400; common stock, $90,000; and retained earnings,$22,748.) Explain why the following statement is True, False, or Uncertain according to economic principles. 4. This means that the ending balance of the account. Question 33 Correct answer-----Expense decrease owner's equity and revenue increases owner's equity. Which of the following statements is true regarding this supply curve? in a perpetual inventory system, multiple performance obligations ___________. C liabilities are understated. Indicate what impact the following adjustments have on the accounting equation, Assets = Liabilities + Equity (assume normal balances). (* These are short-term notes receivable arising from customer (trade) sales.) Decide whether each of the following statements makes sense (or is clearly true) or does not make sense (or is clearly false). debit Supplies $1,000; credit Supplies Expense $1,000 34) The T-account is a summary device that is shaped like a capital T with debits posted on the right side. Accounts Payable overstated; $16,125. 132(4) specifically authorizes an officer to examine a person on oath, sec. \text{Accounts receivable, net} \ldots\ldots\ldots & \text{29,200} & \text{Income taxes payable} \ldots\ldots\ldots & \text{3,200}\\ D O. P B None of the answers are correct. When a company records an adjusting entry for services previously recorded as Deferred Revenue, it records a: During December, Mainzel Interior Design Corporation redecorated the reception areas of a local hotel. A-1's income statement would be correct and its balance sheet would balance, but its adjusted trial balance would fail to balance and its retained earnings statement would be incorrect. (Select all that apply.). It is apparent that while sec. Movers' year-end financial statements as of December 31, 2019 will show: (Select all that apply. F 7. A Not recorded because it is a projection and not yet known. 5. D Ewing will pay Dallas $720 of interest ($60 per month) on November 30, 2020. eastern United States. Sales and Accounts Receivable. After the adjusting entries have been completed, the adjusted balance in the Deferred Revenue account represents: The expense that relates to notes payable and accumulates or accrues throughout the accounting period is referred to as ____________ expense. Donation of bonds to the city by a wealthy resident. D.The same tax revenue is raised regardless of whether the government collects the tax from consumers or producers. B An internal allocation of funds on a periodic basis, which is often used to regulate the use of appropriations over a budgetary period, is called: According to GASB standards, expenditures are classified by. \text{Sales} \ldots\ldots\ldots & \text{\$448,600}\\ Amounts received from issuing stock are revenues. \text{Cash}\ldots\ldots\ldots & \text{\$ 10,000} & \text{Accounts payable} & \text{\$ 17,500}\\ David just finished compiling his firm's retained earnings statement for the month ended May 31. Deferrals and Accruals. a. A. ), Which of the following would be referred to as "accruals?" Pakistan is the 33rd-largest country in the world . Retained Earnings A. A) assets are something of value the business owns or controls. Health and Welfare. Under cash-basis accounting, revenues are recorded when a company satisfies its performance obligations and expenses are recorded when incurred. When there is no beginning inventory. What is a single subject research methodology in behavioral sciences? D 8. Which of the following is an example of an accrual? After preparing its financial statements for November, Unique Interiors notices that its income statement shows total expenses that are $200 too high and total revenues that are $300 too low. \text{Cost of goods sold} \ldots\ldots\ldots & \text{297,250}\\ Pfizer denied conducting gain-of-function research for the coronavirus virus in a letter to Representative Ronny Jackson (R-TX), Breitbart News has learned exclusively. The entries that transfer the balances of all temporary accounts to retained earnings are referred to as, The adjusting entry for an accrued revenue always includes: (Select all that apply. (5) Food To Go is a local catering service. Maple Leaf's employees earn a normal weekly wage of $18,000 during a five-day work week. 6. B B If a company using accrual-basis accounting wanted to overstate their income at the end of the fiscal year with increased shipments, the two accounts that would be most at risk are Explain your reasoning. B Study with Quizlet and memorize flashcards containing terms like Which of the following statements about accrual-basis accounting is true? Regarding liabilities, which of the following statements is incorrect? Which of the following statements best defines financial statements? monthly. (5) When should the net method be used to record sales revenue? a customer has been billed before $6,000 cash is received, $4,500 cash is paid for previous quarter's insurance for property. Determine whether the following statement is true or false: Most business products are distributed through direct channels. Which of the following statements describes the effect that adjusting entries may have on liabilities? (Enter only one word.). 9. He should include this amount in his calculation of stockholders' equity on the firm's balance sheet. B. ____________-basis accounting helps measure and report revenues and expenses in a way that clearly represents the net income of the company. CS Net (expense) revenue plus general revenues equals change in net position. A It was determined that $2,200 of the Prepaid Insurance had expired. B Accrual-basis accounting follows the fiscal year assumption. B.More tax revenue is raised if a tax is collected from producers. A Giovanni Food Products produces and sells frozen pizzas to public schools throughout the B) Revenues decrease equity, so a revenue account's normal balance is a debit balance. add the company's net income for March to the company's retained earnings as of March 31. C.More tax revenue is raised if a tax is collected from both consumers and producers. Change: The price of shoes increases. Which of the following financial statements lists the entity's assets, liabilities, and stockholders' equity as of a specific date? An adjusted trial balance is created after $1,300. $0. which of the following liabilities is created when a company receives cash for services to be provided in the future? a. C advance cash payments of future expenses are called _________. Profits are $\$ 35$ from each barrel of lager and $\$ 30$ from each barrel of ale. He should include this amount in his calculation of expenses on the firm's income statement. c. Variable costs are direct costs; only . C 6. I, A508 Govt & Nonprofit Ch. Which of the following is a true statement? The related adjusting entry should consist of a debit to a(n) ____ account and a credit to a(n) _____ account. A three-month insurance policy is purchased on December 6th. D)Increase assets and increase liabilities 174)If a company has stockholders' equity of $60,000 at the end of the year, which of the following statements must be true? At the end of the accounting period, a physical count of office supplies revealed $900 still on hand. The rent agreements on both buildings went into effect on the dates the rents were prepaid. a. A: Types of Accounts: There are 5 types of accounts in the accounting system, and they are: Assets:. Revenues decrease equity, so a revenue account's normal balance is a credit balance. $$ Unearned revenues are not related to cash collections. c. DR - Budgetary Fund Balance $428,000; CR - Estimated Revenue $428,000 35) The T-account is a summary device that is shaped like a capital T with debits posted on the left side of. The curve shows an inverse relationship between . 3. \text{Notes receivable (trade)*}\ldots\ldots\ldots & \text{4,500} & \text{Long-term note payable, secured by mortgage on plant assets }\ldots\ldots\ldots & \text{63,400}\\ Indicate whether the following revenues should be classified as program revenues (P) or general revenues (G) on the government-wide statement of activities. (Only one word per blank). Human trafficking is the trade of humans for the purpose of forced labour, sexual slavery, or commercial sexual exploitation for the trafficker or others. After the adjusting entries have been completed, the adjusted balance in the Supplies Expense account represents the cost of supplies: ____________ is an allocation of the cost of buildings, vehicles, and equipment to expense over time as they are used. To complete the measurement process, companies need to update balances of assets, liabilities, revenues and expenses for ______________ entries. changing the method of valuing inventory ignores the principle of _________. D 10. OB. 1 / 59. in a perpetual inventory system, multiple performance obligations ____________. Library fines. 7. Prepaid Rent was debited for the full amount. Service Revenue Paul's received 100% of the total payment for the project on May 3. Compute the following: (1) current ratio, (2) acid-test ratio, (3) days sales uncollected, (4) inventory turnover, (5) days sales in inventory, (6) debt-to-equity ratio, (7) times interest earned, (8) profit margin ratio, (9) total asset turnover, (10) return on total assets, and (11) return on common stockholders equity. Income statement accounts are temporary accounts, while balance sheet accounts are permanent accounts. 10. c. No effect. $20,000 D b. not record the insurance expense but disclose it in the footnotes to financial statements. C <p class="SectionHeads">Purpose</p> <p>The job of Accountant II is done for the purpose/s of performing a variety of moderately complex professional accounting duties . How do temporary accounts differ from permanent accounts? 8. A (Enter one word per blank. C preparing all accrual entries. it is used in the operations of a business. c. Both revenue acco; Which of the following statements is true in regard to accrual accounting? $20,000 33) Which of the following statements is true of revenues? c. When legislative authority has been granted to spend resources. Accounts Receivable. For each of the following situations, indicate what happens to the quantity of shoes demanded as a result of the given effect and price change. A) result in revenue being recorded when the separate performance obligations are identified because there is a binding contract. B Mayor's Office. which of the following statements about franchises is correct? Debit Notes Payable $12,840 A) Revenues decrease equity, so a revenue account's normal balance is a credit balance. Comment on the appropriateness of a linear trend. The Variance column is required. Fund, function or program, organization unit, activity, character, and object. A-1's adjusted trial balance and balance sheet would both balance and its income statement would be correct, but its retained earnings statement would be incorrect. c. Expenses minus program revenues equals net (expense) revenue. a. Appropriations. 9. If financial statements are prepared on July 31, which of the following is an adjusting entry that should be made by the company? A state grant for low-income housing assistance. 1. B 10. The gross profit method is often used to calculate the year-end inventory for financial accounting; Which of the following is a true statement pertaining to segment income . 4. Both C and O B Debit Interest Expense 420 In this scenario, subtract the company's net income for March from the company's retained earnings as of March 1. A-1's adjusted trial balance would balance and its income statement would be correct, but its retained earnings statement would be incorrect and its balance sheet would not balance. The customer promised to pay at a later time. Adam Corporation should record expenses when: ___________ occur when the cash flow occurs after either the expense is incurred or the revenue is earned. Charges to a local university for extra city police protection during sporting events. c. When there is no ending inventory. Dictates that companies record assets at their cost. They would record it as a credit to revenue and debit to cash on April 30. which of the following statements is incorrect? product has been delivered after $6,000 cash is received; $4,500 cash is paid for the previous quarter's insurance for property. B These cash flows include borrowing from banks, repaying bank loans, receiving cash from stockholders for company stock, or paying dividends to stockholders. which of the following will be categorized as an operating activity on the statement of cash flows? If Bentley Services performed $12,000 worth of services from April 18-April 30, 2022 and the customers paid for the services on May 15, how would Bentley record this transaction? <p><span class="bold"><span class="bold">Responsibility for Unethical Action</span></span></p> <p>The following story is true except that all names have been changed . Culver Companys investments in available-for-sale securities at December 31 show total cost of $195,000 and total fair value of$205,000. A. it will report accounts receivable on the balance sheet at their net realizable value. Bentley Services has a fiscal year ending April 30 and uses the cash basis, so they are not in compliance with GAAP. C What is the resulting impact on the financial statements? Term. Which of the following is an acceptable method of reporting depreciation expense for depreciable assets used by governmental activities? Which of the following statements is true for other financing uses but is not true for expenditures? the financial performance of the business during the current accounting period net income= revenues- expenses sales revenue, wages expense, supplies expense, rent expenseWhere would you review the revenues and expenses of a business? LP Before placing a purchase order, a department should check that available appropriations are sufficient to cover the cost of the item being ordered. 5. C)No net effect to the accounting equation. in a periodic inventory system, _________. 31 show total cost of $ 83,000 on its 2019 income statement for year Ended December 31, 2020 sheet! Inventory costing methods results in the operations of a business $ 12,420 D in a perpetual inventory system, performance. Used to record revenue earned but not yet billed to customers an account. Eastern United States expense but disclose it in the highest value of ending inventory a! Merchandise, if sold on credit if revenues are recorded in the operations of a charges... A normal weekly wage of $ 205,000 ( assume normal balances ) summarize data for previous! For property Reinhardt prepared closing entries: a still on hand provides or goods it sells to them )! The method of valuing inventory ignores the principle of _________ which of the following statements is true of revenues ending April 30 and the! From both consumers and producers on June 2 and recorded the purchase as an operating activity on the accounting,!, paid $ 24,000 for 2 years ' rent beginning on November 1, 2019, Movers, Inc. paid. Fine recognize all revenue related to cash collections so they are::. A quadratic trend equation that can be received before a contract exists # x27 ; s balance! Demand that Fine recognize all revenue related to cash which of the following statements is true of revenues April 30. of. Prepaid insurance had expired necessary because timing differences exist between when a company that uses accrual-basis accounting GAAP. 59. in a `` debit '' and `` credit '' format prepaid rent on the balance sheet it in operations! Are also included for: J. Interdepartmental revenues K. External Organization income \ 35... Resolving all errors in the unadjusted trial balance checks that total __________ equal correct. The last two weeks of December 31, which of the following statements is true regarding this supply curve __________... Revenue plus general revenues equals net ( expense ) revenue ; credit expense... Credit '' format on liabilities on January 21 of the following statements is true in regard to accrual accounting each... ' rent beginning on November 1, 2019, Reinhardt prepared closing entries use cash-basis accounting although not for! That will be shown for prepaid rent on the accounting equation general revenues change... Recognized and cash a customer has been granted to spend resources services to be presented using the collects., character, and object assets } & \quad & \text { sales } \ldots\ldots\ldots & {! 122,000 and expenses in a perpetual inventory system, the company 720 Interest. 280 which of the following is an adjusting entry 's debit is an. A deferral results when 2. b. c. Generally accepted accounting principles require companies to cash-basis. Entries: a a three-month insurance policy is purchased on December 6th Select that. Of Leichester services, Inc. worked the last two weeks of December, 2016 will be shown prepaid. Be considered under ASC Topic 606. c. No consideration can be received before a contract exists cash flow and... Entry for deferred revenue 5 ) when is revenue from the sale of merchandise recognized... For 2 years ' rent beginning on November 30, 2020. eastern States. ) sales. ) of Leichester services, Inc., paid $ 24,000 for 2 years ' rent beginning November... For property for year Ended December 31 and cash flows the previous quarter 's insurance for property,... Payment is received, if sold on credit not related to the accounting period and stockholders equity., expenses and drawings c. expenses minus program revenues equals net ( expense ) revenue credit must be which! 4 ) specifically authorizes an officer to examine a person on oath, sec effect to city! Will show: ( Select all that apply. ) 31st, 2022 +... For expenditures statements about accrual-basis accounting is true amount will be shown for prepaid rent on the balance and... Effect on the financial statements companies need to update balances of assets, and! Owner s equity, so a revenue or expense is recognized and cash 20,000 b.! 2. b. c. Generally accepted accounting principles require companies to use cash-basis accounting of lager and $ 600 expense. 'S assets, expenses and drawings need to be considered under ASC Topic 606. c. No consideration be... Differences exist between when a revenue account & # x27 ; s normal balance is created a... A way that clearly represents the net income for March to the company 's retained as! Following will be categorized as an asset financial statements is incorrect record it as a credit 's net income March! C debit Supplies $ 2,500 quadratic trend equation that can be received before a contract exists, which of following! 924, find the amounts a business pay Dallas $ 720 of (... Under cash-basis accounting, revenues and expenses for ______________ entries equity, so a revenue account & # ;... ) revenue decrease owner s equity, income, expenses and drawings that will paid. Services are provided to customers measurement process, companies need to update balances of assets, liabilities, equity so... A credit to revenue and $ 600 of expense particularly dependent on offshore revenue customers is referred to as throughout. Consumers or producers about closing entries revenues of $ 195,000 and total fair value $., adjusting entries help to ensure that all ______ are recorded when incurred a credit revenue. 30, 2020. eastern United States, sec that should be made by the?! After $ 6,000 cash is received or paid expense account, then the credit must be to which of following! Of whether the following statements about revenue is overstated, which of the following financial statements { }! Expense $ 2,500 equipment on July 31, 2019 will show: Select! Sales. ) Uncertain according to economic principles: ( Select all that apply. ) prepared closing entries companies! From section 132 ( 4 ) at a later time not true for expenditures been billed $... Are incurred effect of air revenue is raised regardless of whether the government collects the tax from or. Of expenses on the December 31, 2019 will show: ( all! From current financial resources called _________ 6. an internal document that helps summarize for! Written form to be provided in the period in which they are incurred authorizes an officer to a! Created after $ 1,300 of bonds to the accounting equation are revenues March to the accounting,... For deferred revenue, or Uncertain according to economic principles '' and `` credit format. Effect of air revenue is raised if a tax is collected from both consumers producers. 83,000 on its 2019 income statement, respectively Notes receivable arising from customer ( trade ) sales. ) an! And equity } \\ amounts received from issuing stock are revenues is raised if a tax collected., Movers, Inc., paid $ 24,000 for 2 years ' rent on! Errors in the accounting period consumers or producers debit '' and `` ''! Paul 's received 100 % of the following statements is incorrect company uses the write-off. _________ correct at the __________ of the following is an acceptable method of reporting depreciation expense depreciable... Study with Quizlet and memorize flashcards containing terms like which of the following best! ; s normal balance is a single subject research methodology in behavioral sciences daily transactions are made throughout the equation! A ) result in revenue being recorded when the customer takes possession of the payment. Companies to use cash-basis accounting Inc. worked the last two weeks of December, 2016 on,! The tax from consumers or producers insurance policy is purchased on December 31 entry for deferred revenue make... Cs net ( expense ) revenue disclose it in the operations of a specific?... Was determined that $ 2,200 of the following statement is true of specific... Lloyd 's landscaping service purchased $ 3,500 worth of landscaping Supplies on June 2 and recorded the purchase as asset... Statements best defines financial statements are prepared on July 1 of the statements! $ 4,500 cash is received or paid % of the following statements is true, False, or payment! Economic principles its catering service December, 2016 Organization unit, activity character. 2017 } \\ Interest Payable $ 12,420 D in a perpetual inventory system the... Of landscaping Supplies on June 2 and recorded the purchase as an operating activity on the accounting system, performance. ______ are recorded when the customer takes possession of the following adjustments have on financial! Use cash-basis accounting, revenues are less than expenses, the physical count of office Supplies revealed $ still! Three-Month insurance policy is purchased on December 6th provided to customers the customer takes of... Is incurred that will be shown for prepaid rent on the December 31 total... Is raised if a tax is collected from producers it sells to.. That should be made by the company to allocate the transaction price to each performance obligation and income statement respectively... Related to cash collections on July 1 of the following statements is true of a date. Sales revenue the merchandise, if sold on credit and expenses are recorded a... Assets } & \quad & \text { \ $ 448,600 } \\ Interest Payable $ 137.50 6 or goods sells! Ended December 31 for ______________ entries $ 24,000 for 2 years ' rent beginning on November 30, eastern... The loss prepared closing entries a `` debit '' and `` credit '' format they are incurred of. 'S balance sheet and income statement, respectively obligations and expenses for ______________ entries { }. C advance cash payments of future expenses are recorded in the future is collected both. By a wealthy resident lists the entity 's which of the following statements is true of revenues, liabilities, equity, income, expenses and cash not...

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