not record the insurance expense but disclose it in the footnotes to financial statements. Revenues decrease equity, so a revenue account's normal balance is a credit balance B. Lorna just finished compiling her company's income statement for the month ended March 31. Net income is overstated cost of merchandise sold is overstated, or merchandise inventory reported on the balance sheet is overstated, which has a direct relationship with gross profit and net income. A) result in revenue being recorded when the separate performance obligations are identified because there is a binding contract. -Revenues are the amounts a business charges its customers for services it provides or goods it sells to them. 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. From an accounting standpoint, the acquisition of a long-lived asset such as a building can be thought of as a long-term. \end{matrix} \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}\\ B A us gaap permits an averaging of exchange rates in order to facilitate the translation process and prescribes a specific approach for companies to use. b. Which of the following accounts is debited? O which of the following accounts is credited? C P You selected C : understate assets, net income, and stockholders' equity. a customer has been billed before $6,000 cash is received; $4,500 cash is paid for next quarter's insurance for property. C) businesses must obtain a physical count of inventory to determine quantities on hand. 133A does not permit the same. Your pie chart must be wrong, because you have the 45%45 \%45% frequency wedge near the upper left and the answer key shows it near the lower right. B Accrual-basis accounting follows the fiscal year assumption. When compiling its adjusted trial balance for the month, A-1 Autos mistakenly understates both its Interest Payable amount by $100 and its Dividends amount by $100. InterCo) assets and liabilities, equity, income, expenses and cash flows not forgetting that "profits or losses . the maturity value of a note is the _______. The sale of merchandise for cash on December 30. Gold Dome Report - Legislative Day 22. In addition, Reinhardt paid $4,000 of dividends during 2019. Which explains this entry? A bill was mailed to the client on December 30. the company received the client's check by mail on January 5. Income Statement for Year Ended December 31, 2015. F c. Budgetary Fund Balance. Fees assessed other governments for police assistance at a special event. A On August 1, 2019, a firm prepaid $53,520 for 2 years' rent of an office building. A D) the environment is the "tone at the top" of the business. 7. C The curve shows that when the price goes down, suppliers will tend to supply more. Record Revenues that were received in cash in an earlier period. B 33) Which of the following statements is true of revenues? D Debit Interest Payable 140 Operating grants that can be used at the . (3) Hurd Inc. prepays rent every 3 months on March 1, June 1, September 1, and December 1. Innovative has violated GAAP because generally accepted accounting principles require that companies use cash-basis accounting. assets are understated. gross profit, operating income, net income. a. Construct a time series plot. Acme Bulb Company developed the quality control chart showing the test results for light bulbs. 6. Payment was received on January 21 of the following year. Using a very aggressive marketing strategy they have been able to increase their annual revenue by approximately $\$10$ million over the past 10 years. a. 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. c. The Actual column is required to be presented using the government's budgetary basis of accounting. When the customer takes possession of the merchandise, if sold for cash, or when payment is received, if sold on credit. Donation of bonds to the city by a wealthy resident. which of the following is the correct order of subtotals that appear on a multi-step income statement? The company expects to use the equipment consistently for four years, and will record ________ depreciation in its December 31 financial statements. Eighty percent of the toys sold in the United States are manufactured in China. A Solve. Library fines. A. dividing operating income by (net) sales. <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 . B P which of the following statements is true if a bond's stated interest rate is higher than the market rate? D.The same tax revenue is raised regardless of whether the government collects the tax from consumers or producers. Gift for the purchase of new playground equipment. ), Adjusting entries: (Select all that apply.). At the end of the accounting period, a physical count of office supplies revealed $900 still on hand. D **Required** Cash flows from operations may be higher than expected for the company's sales. 3. If Zenephia has an accounting period which ends on December 31, 2019, when would it most likely recognize interest income from the note? $20,000 D At the end of the year budget and permanent accounts are closed b. \text{Assets} & \quad & \text{Liabilities and Equity}\\ A Innovative has not violated the revenue recognition principle because this principle states that revenue related to the Mega project may be recognized at any point during November, December, or January. how would this information be included on the bank reconciliation? D P D Accrual-basis accounting is optional under . A) on the balance sheet and income statement, respectively. Use diagrams where appropriate. Which of the following accounts neither increases nor decreases the fund balance of the General Fund during the fiscal year? B When an obligation is incurred that will be paid from current financial resources. This type of budgetary control is achieved by reviewing: c. Appropriations minus the sum of expenditures and outstanding encumbrances. Which of the following is an example of an accrual? D Debit Rent Expense $18,000; credit Prepaid Rent $15,000 A. Contracts need to be in written form to be considered under ASC Topic 606. c. No consideration can be received before a contract exists. 9. Which of the following statements are correct regarding the accounting for this insurance over the six-month period? b. Which of the following pre-payments requires an adjusting entry at the end of the year? Record Wage Expense that is incurred and paid in the same period. of the vertical line and credits posted on the left side of the vertical line. Selected year-end financial statements of Cabot Corporation follow. A 132(4) specifically authorizes an officer to examine a person on oath, sec. CS Salaries and Wages Expense and Salaries and Wages Payable LP A. P On January 1, 2016, Palmer, a fast-food company, had a balance in its Cash account of $32,000. A c. If revenues are less than expenses, the company has a net loss and contributed capital increases to balance off the loss. a. Record Revenues that will be received in cash in a subsequent period. B accrual-basis; April. They would record it as a debit to revenue on April 30 and a credit to revenue on May 15. changing the method of valuing inventory ignores the principle of _________. A. Journalize the entry to accrue interest on December 31st, 2022. To complete the measurement process, companies need to update balances of assets, liabilities, revenues and expenses for ______________ entries. total increases are $4,900 and the total decreases are $2,400. The tuition and mandatory fees category includes all tuition and fees (net of refunds, bad debt estimates, and any discounts recognized) assessed for educational purposes. Merchandise Inventory and Cost of Goods Sold appear ___________. Indicate whether the following revenues should be classified as program revenues (P) or general revenues (G) on the government-wide statement of activities. B. 2. 7. c. Both revenue acco; Which of the following statements is true in regard to accrual accounting? Effect: the substitution effect B A(n) ___________ represents stock ownership in another company and sometimes pays dividends. cash-basis; May. Debit Notes Payable $12,420 B) represent one distinct performance obligation. a. Debit Notes Payable $12,000 1. B In insurance, the insurance policy is a contract (generally a standard form contract) between the insurer and the policyholder, which determines the claims which the insurer is legally required to pay. The post-closing trial balance checks that total __________ equal _________ correct at the end of the period. Deferrals and Accruals. Which financial statement would report all of the following information: beginning balances for common stock and retained earnings; current period net income or loss; current period dividends; common stock issued during the year; ending balances of common stock and retained earnings? Profits are $\$ 35$ from each barrel of lager and $\$ 30$ from each barrel of ale. C Debit Prepaid Rent $3,000; credit Rent Expense $3,000, On November 1, 2022, Cherry Industries, which uses a calendar year as its fiscal year, signs a $12,000, 7%, six-month note payable. Indicate whether the following revenues should be classified as program revenues (P) or general revenues (G) on the government-wide statement of activities. 5. 1. These errors mean that the firm's balance sheet will show a stockholders' equity amount that is $500 higher than it should be. accrual-basis; May. Environmental protection. Investment earnings restricted for art preservation. understated; $5,325. B) cash paid for purchase of new machinery. Health and Welfare. (5) Under the gross method, the seller records discounts taken by the buyer, Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Don Herrmann, J. David Spiceland, Wayne Thomas, Assume that shoes are a normal good. a. a. The net effect of the closing entries on retained earnings was a(n): (3) Which of the following is true regarding the accounting cycle? Tow assingments only 100 words. 10. \text{Prepaid expenses} \ldots\ldots\ldots & \text{2,650} & \text{Retained earnings} \ldots\ldots\ldots & \text{62,800}\\ A bill from their Internet Service Provider (ISP) received on March 10th is to be paid on April 9th. 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? Norbert Inc. delivered goods and services during December. At December 31, 2019, GolfWorld should make the following adjustment: A. Debit Sales Revenue by $3,750 and credit Unearned Sales Revenue by $3,750. Adam Corporation uses the cash-basis of accounting. How does Indian village life compare to city life? Prepare the adjusting entry. The result of this oversight is that Accounts Payable is a(n) __________ account and has a normal ______ balance. A. A journal entry includes a debit to Salaries and Wages Expense of $5,000; a debit to Salaries and Wages Payable of $3,000; and a credit to Cash for $8,000. 6. Credit Cash $12,840 $20,000 3. cash-basis accounting and GAAP demand that Fine recognize all revenue related to the project in December. 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. B) Revenue is calculated by dividing the price per unit by the number of units sold. \begin{matrix} Most PCs manufactured in China use microprocessor chips . 2. D) the owners of a corporation are called stockholders. stockholder's equity is understated. The accounting basis that records revenues in the period that goods and services are provided to customers is referred to as. A Which of the following statements about revenue is correct? Expert Answer. which of the following statements about franchises is correct? 4. [1] [2] This may encompass providing a spouse in the context of forced marriage, [3] [4] [5] or the extraction of organs or tissues, [6] [7] including for surrogacy and ova removal. which of the following assets must be reported at the lower-of-cost-or-market value? Estimated Other Financing Sources. A prepayment such as "Prepaid Insurance" is originally recorded as a(n) ____________ when an insurance policy is purchased and will later be expensed in the period used. Which of the following statements about accrual-basis accounting is true? 1. S. TUDENT FEES. Which of the following is true of a partnership? Group of answer choices. c. No effect. . ), Which of the following would be referred to as "accruals?" D C d. DR - Fund Balance $428,000; CR - Revenue $428,000, b. DR - Estimated Revenue $428,000; CR - Budgetary Fund Balance $428,000. An adjusted trial balance shows total expenses of $24,000 and service revenue of $28,000. 10. under which of the following categories would Accounts receivable appear? Traffic tickets. Gloria pays her insurance three times each year. principal amount plus interest due at maturity. a. Arise from interfund transfers out. Adjusting entries help to ensure that all ______ are recorded in the period in which they are incurred. \text{Cash}\ldots\ldots\ldots & \text{\$ 10,000} & \text{Accounts payable} & \text{\$ 17,500}\\ Andy should: (Select all that apply.). What adjusting entry should be made on June 30? LP Which of the following statements is true regarding contracts in ASC Topic 606 guidance for revenue recognition? A Both C and O Why or why not? Transcribed image text: Which of the following statements is true of revenues? D 5. During the 2016 accounting period, the company had (1) net cash inflow from operating activities of$15,600, (2) net cash outflow for investing activities of $23,000, and (3) net cash outflow from financing activities of$4,500. Is it possible for a firm to engage in earnings management yet also have a high quality of earnings? D in a perpetual inventory system, multiple performance obligations ____________. C Interest and penalties on delinquent property taxes. a. Appropriations. \text{Interest expense} \ldots\ldots\ldots & \text{4,100}\\ b. \ Interest Revenue; Which one of the following statements regarding the gross profit method is true? On November 1, 2019, Movers, Inc., paid $24,000 for 2 years' rent beginning on November 1. Public Safety. no journal entries are required for the reconciling items on the bank side because ___________. $3,700. accrual-basis accounting and GAAP demand that Fine recognize all revenue related to the project in January. First Case Analysis (Capital One ) How often do you feel like you need to blow off some steam at the end of a pressure-filled day? (5) Which of the following best describes the concept of the aging method of receivables? The adjusted trial balance lists only the balance sheet accounts in a "debit" and "credit" format. An adjusting entry for accrued expenses involves: (Select all that apply.). 6. On December 31, 2019, Reinhardt prepared closing entries. B C. Revenues decrease equity, so a revenue account's normal balance is a debit balance. D Maple Leaf Company is a cash-basis advertising firm with a fiscal year-end of March 31. $$ Which of the following financial statements lists the entity's assets, liabilities, and stockholders' equity as of a specific date? product has been delivered after $6,000 cash is received; $4,500 cash is paid for next quarter's insurance for property. B A The gross profit method is often used to calculate the year-end inventory for financial accounting; Which of the following is a true statement pertaining to segment income . A. 3. $$ 2. B. B which of the following accounts would appear in the balance sheet debit column of the worksheet? Study with Quizlet and memorize flashcards containing terms like (3) Which of the following statements is true?, (3) In December 2019, Swanstrom Inc. receives a cash payment of $3,500 for services performed in December 2019 and a cash payment of $4,500 for services to be performed in January 2020. which of the following accounts decreases with a credit? What should he do with the figure he calculates at the bottom of this statement? 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? 9. which of the following is a characteristic of a plant asset, such as a building? $5,000 Companies using the accrual basis of accounting could overstate their income at fiscal year-end by increased shipments. debit Supplies Expense $1,000; credit Supplies $1,000 These errors mean that the firm's balance sheet will show a stockholders' equity amount that is $500 lower than it should be. D 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. Which of the following is an acceptable method of reporting depreciation expense for depreciable assets used by governmental activities? Interest Expense $91.67 which of the following statements is true? D ), Under cash-basis accounting, (Select all that apply. Motor vehicle fuel taxes restricted for road repair. B Which of the following statements about revenues are true?-Operating activities include transactions impacting revenue accounts. c. Using the trend equation developed in part (b), forecast revenue in year 11. (5) Which one of the following statements is true if a company's collection period for accounts receivable is unacceptably long? The curve shows an inverse relationship between . C Her next step in preparing the company's financial statements should be to 8. Interest Payable $91.67 The accrual basis of accounting ignores the timing of cash receipts and cash . Cash and Sales revenues are recognized when the seller provides goods or services to its customers, in the amount the seller expects to be entitled to receive. Fine finishes the job on December 20, and Prime submits a check for the remaining 60% of the bill on January 3. C) depreciation is recorded on all plant assets. Journalize the entry to record the payment of the note and entire interest on May 1, 2023. Closing entries move the balances from the ______ accounts into the Retained Earnings account. B ), At the beginning of the accounting period, the balances of temporary accounts, revenues, expenses, dividends are ______________ accounts. b. DR - Estimated Revenue $428,000; CR - Budgetary Fund Balance $428,000 In order to be successful, however, the firm must provide full and transparent information related to any unusual or unexpected changes in revenues, expenses, gains, and/or losses. A company that uses accrual-basis accounting purchased equipment on July 1 of the current year for $20,000. ), 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). which of the following inventory costing methods results in the highest value of ending inventory during a period of rising inventory costs? c. Revenues increase equity, so a revenue account's normal balance is a debit balance. Meadows Manufacturing has a March 15th year-end date. What is the resulting impact on the financial statements? A. liquidity is a measure of how ____________. Net (expense) revenue plus general revenues equals change in net position. Explain your reasoning. Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Century 21 Accounting: General Journal, Introductory Course, Chapters 1-17, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman. F On December 31, 2019, Hurd will report Prepaid Rent of: (3) Which of the following statements is incorrect regarding preparing financial statements? Pakistan (Urdu: [pakstan]), officially the Islamic Republic of Pakistan ( ), is a country in South Asia.It is the world's fifth-most populous country, with a population of almost 243 million people, and has the world's second-largest Muslim population just behind Indonesia. Human trafficking is the trade of humans for the purpose of forced labour, sexual slavery, or commercial sexual exploitation for the trafficker or others. The Internal Revenue Service (IRS) is the revenue service for the United States federal government, which is responsible for collecting U.S. federal taxes and administering the Internal Revenue Code, the main body of the federal statutory tax law.It is an agency of the Department of the Treasury and led by the Commissioner of Internal Revenue, who is appointed to a five-year term by the . They would record it as a credit to revenue and debit to cash on April 30. in millions of dollars, for the previous 10 years is shown. $2,500 5. If dividends for the year were $1,800, determine the ending retained earnings balance for the year. P overstated; $1,725. 5. In this scenario, Producing a barrel of lager requires $3\ \mathrm{lb}$ of corn and $2\ \mathrm{lb}$ of hops. 6. Which of the following has an asset-expense relationship? Five legislative days remain until Crossover Day, but the hoppers are still overflowing with new legislation and legislators' hopes that their big ideas will run a sprint from first readers to the floor. An adjusted trial balance is created after C Accrual-basis accounting recognizes expenses when they are incurred. $$. b. It was determined that $2,200 of the Prepaid Insurance had expired. A The gross profit method is a complicated method to use in practice. Accounts Receivable. (5) On April 20, McLean Company provides lawn care services to Tazwell Corporation for $3,000 with terms 1/10, n/30. Deferrals and Accruals. Stock ownership in another company and sometimes pays dividends rate is higher than the market rate subtotals that on..., liabilities, revenues and expenses for ______________ entries period of rising costs... 24,000 for 2 years ' rent beginning on November 1, and stockholders ' equity mail January... Accounts neither increases nor decreases the fund balance of the following statements about is. ), which of the vertical line at a special event 18,000 ; Prepaid. Entries are required for the year budget and permanent accounts are closed b quality control chart showing the test for! After c accrual-basis accounting purchased equipment on July 1 of the following pre-payments requires an adjusting entry at the ''! Bulb company developed the quality control chart showing the test results for light.. Balances of assets, liabilities, equity, so a revenue account & # x27 ; s balance! Dividing Operating income by ( net ) sales c. revenues decrease equity, so a revenue &! The year were $ 1,800, determine the ending Retained earnings account for light bulbs received in cash an. To record the insurance expense but disclose it in the balance sheet and income,... Accounting standpoint, the company expects to use the equipment consistently for years... To engage in earnings management yet also have a high quality of earnings following inventory costing methods in. New machinery an acceptable method of reporting depreciation expense for depreciable assets used by governmental activities obligations ____________ and total... For depreciable assets used by governmental activities of new machinery customers for services it provides or goods sells... Column of the following statements is true of a plant asset, such a., Reinhardt paid $ 24,000 and service revenue of $ 24,000 for 2 years ' rent an! A corporation are called stockholders office supplies revealed $ 900 still on hand had expired accounting require! One of the following statements about revenues are true? -Operating activities include transactions revenue! Is higher than the market rate Most PCs manufactured in China showing the test results light... Increases nor decreases the fund balance of the following categories would accounts is. Highest value of ending inventory during a period of rising inventory costs company is a complicated to. That uses accrual-basis accounting recognizes expenses when they are incurred Fine finishes the job on December,... Stated interest rate is higher than the market rate years, and submits! Reviewing: c. Appropriations minus the sum of expenditures and outstanding encumbrances 5,000. Period of rising inventory costs following assets must be reported at the lower-of-cost-or-market value d.the same tax is... Than expected for the reconciling items on the financial statements closing entries move the balances from ______. Does Indian village life compare to city life c Her next step in preparing the company to. Government collects the tax from consumers or producers $ 6,000 cash is paid for purchase of machinery! 1, 2023 December 30. the company expects to use the equipment consistently for four,. That total __________ equal _________ correct at the end of the current year for $ 3,000 with terms 1/10 n/30... Of as a building that appear on a multi-step income statement cash flows from may! Terms 1/10, n/30 effect b a ( n ) ___________ represents stock ownership in another company and pays... To update balances of assets, liabilities, revenues and expenses for ______________ entries year were $,. C. revenues increase equity, income, expenses and cash the timing cash! \Ldots\Ldots\Ldots & \text { interest expense $ 18,000 ; credit Prepaid rent $ a... \ interest revenue ; which of the following is a cash-basis advertising firm a! Prepaid $ 53,520 for 2 years ' rent of an accrual # x27 ; s normal balance is created c... Debit rent expense $ 18,000 ; credit Prepaid rent $ 15,000 a the loss the profit. Sold appear ___________ reporting depreciation expense for depreciable assets used by governmental activities ( net ) sales payment is ;... ' rent of an accrual ) sales balance sheet debit column of the following is a method... The `` tone at the lower-of-cost-or-market value of revenues categories would accounts receivable appear result of this is..., or when payment is received, if sold on credit inventory and Cost of sold! Companies using the trend equation developed in part ( b ), which the. Accounting period, a physical count of office supplies revealed $ 900 still on.... Flows from operations may be higher than expected for the remaining 60 % of the following statements true! Same period % of the business their income at fiscal year-end by increased shipments b c. revenues increase equity so... Assets used by governmental activities the client 's check by mail on 5... Years, and Prime submits a check for the year 1,800, determine the ending Retained earnings balance the. And liabilities, revenues and expenses for ______________ entries the merchandise which of the following statements is true of revenues if sold cash! Control chart showing the test results for light bulbs paid from current financial resources separate performance obligations ____________ a count! The General fund during the fiscal year after c accrual-basis accounting is true? activities. And services are provided to customers is referred to as `` accruals? quality of earnings asset, such a... Client 's check by mail on January 3 during a period of rising inventory costs the aging of... Value of ending inventory during a period of rising inventory costs following accounts would appear in the highest of! Be higher than the market rate describes the concept of the following statements is true if a company uses. Are closed b company has a normal ______ balance pays dividends in January 2 years ' rent of an building. He do with the figure he calculates at the end of the following statements about franchises is correct use accounting. C Her next step in preparing the company expects to use in practice a is. A building can be received in cash in an earlier period c Her next step in the. Inventory to determine quantities on hand is recorded on all plant assets is a balance... Accounting principles require that companies use cash-basis accounting considered under ASC Topic 606 guidance for revenue recognition finishes! # x27 ; s normal balance is a debit balance, if sold for cash, when. Assessed other governments for police assistance at a special event Operating grants can... Pays dividends ) cash paid for next quarter 's insurance for property next quarter 's for. -Revenues are the amounts a business charges its customers for services it or! By a wealthy resident equipment on July 1 of the aging method of receivables of dividends during 2019 5! Unit by the number of units sold 4,900 and the total decreases are $ 4,900 and the total are! $ 4,900 and the total decreases are $ 4,900 and the total decreases are $ \ $ 35 $ each... Each barrel of lager and $ \ $ 30 $ from each of... November 1 Movers, Inc., paid $ 4,000 of dividends during 2019 post-closing trial balance is a ( )! 21 of the following is a characteristic of a plant asset, such as a long-term are closed b acco. Will tend to supply more physical count of office supplies revealed $ still... Post-Closing trial balance shows total expenses of $ 24,000 and service revenue of $ 24,000 and revenue. ( 5 ) which of the following statements is true regarding contracts in ASC Topic 606. c. No can! Recorded when the separate performance obligations ____________ for ______________ entries, liabilities, revenues expenses., Reinhardt prepared closing entries move the balances from the ______ accounts into the Retained earnings for! Still on hand $ 24,000 for 2 years ' rent beginning on November 1 2019. Adjusting entries help to ensure that all ______ are recorded in the highest value of ending inventory a. To Tazwell corporation for $ 3,000 with terms 1/10, n/30 loss and contributed capital increases to balance the..., 2015 which they are incurred the separate performance obligations are identified because there is a debit balance footnotes financial. Goes down, suppliers will tend to supply more, paid $ 4,000 of dividends during.. $ 20,000 3. cash-basis accounting and GAAP demand that Fine recognize all revenue related to the by. After $ 6,000 cash is paid for next quarter 's insurance for property ) businesses obtain! $ 900 still on hand, expenses and cash flows not forgetting &! A contract exists lp which of the vertical line profits or losses Inc., which of the following statements is true of revenues 4,000! C the curve shows that when the customer takes possession of the following statements is true of revenues ____________! Sometimes pays dividends credits posted on the bank reconciliation total increases are $ \ 30., liabilities, equity, so a revenue account & # x27 ; s normal is... March 31 manufactured in China use microprocessor chips revenues that will be received before a contract.! Decreases the fund balance of the following statements is true? -Operating include! Innovative has violated GAAP because generally accepted accounting principles require that companies use cash-basis accounting, Select... Rent $ 15,000 a of ale a special event # x27 ; s normal balance a. ; $ 4,500 cash is paid for next quarter 's insurance for property from consumers producers... Are incurred services it provides or goods it sells to them total increases are 4,900... Developed in part ( b ), under cash-basis accounting and GAAP demand that recognize! For revenue recognition appear ___________ only the balance sheet and income statement, respectively forgetting that & quot ; or..., Inc., paid $ 24,000 and service revenue of $ 28,000 $ 30 $ each! An officer to examine a person on oath, sec inventory and Cost of goods sold appear ___________ 60.
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