add the company's net income for March to the company's retained earnings as of March 31. A classified balance sheet shows subtotals for current ____________ and current ___________. Q: revenues ew less than expenses, what . Both C and O D A. December 31, 2019, and June 30, 2020 **, (5) The "principal" of a note receivable refers to, (5) Net profit margin percentage is calculated by. Which of the following statements is true about revenue? How much does your employer pay into the social security system on your behalf? b. The gross profit method is a complicated method to use in practice. In December, Innovative Interiors completed redecorating Mega Corporation's headquarters. Which of the following statements about accrual-basis accounting is true? 8. How do the following circumstances sometimes lead to market failure? Accident investigation. A A bill from their Internet Service Provider (ISP) received on March 10th is to be paid on April 9th. (3) Dallas Company loaned $10,000 to Ewing Company on December 1, 2019. spread the insurance expense evenly over twelve months. If revenues are greater than expenses, the company has net income and contributed capital increases. At that time, Prime provides Fine with 40% of the total payment for the project. overstate liabilities and understate stockholders' equity. in a perpetual inventory system, multiple performance obligations ____________. 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. b. O. Retained Earnings Revenues decrease equity, so a revenue account's normal balance is a credit balance. Unearned revenues are reported on the Income Statement. which of the following inventory costing methods results in the highest value of ending inventory during a period of rising inventory costs? Revenues decrease equity, so a revenue account's normal balance is a credit balance. (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. 3. which of the following statements is true? Meadows Manufacturing has a March 15th year-end date. D To complete the measurement process, companies need to update balances of assets, liabilities, revenues and expenses for ______________ entries. revenues are recognized when the seller provides goods or services to its customers, in the amount the seller expects to be entitled to receive. 4. 1. In addition, Reinhardt paid $4,000 of dividends during 2019. understated; $5,325. the liability created when a business collects cash from its customers before completing a service or delivering a product is called _____. a. Appropriations. C Question 33 Which of the following is a true statement? The sale of merchandise for cash on December 30. When there is no beginning inventory. M Testbank practice questions 11 88: resource managemem fn: decision making accessibility: keyboard navigation blooms: understana difficulty: eas:r leaming A) Revenues decrease equity, so a revenue account's normal balance is a credit balance. B c. Expenses minus program revenues equals net (expense) revenue. 6. 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. The company should debit Accounts Receivable for $500 and credit Service Revenue for $500. -Revenue is reported when the company is paid by the customer. Green Lawns Corporation earned $500 for landscaping services rendered. ACCOUNTING FINAL REVIEW. a. A company forgot to prepare the adjusting entry to record the current month's portion of Prepaid Rent. 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. (5) If a company uses the direct write-off method of accounting for bad debts. The curve shows that when the price goes down, suppliers will tend to supply more. If one of these light bulbs is selected at random, find the probability that the light bulb is: (a) Good; (b) Good, given that it is 606060 watts; ( c ) defective, given that it is not 303030 watts. which of the following is the correct order of subtotals that appear on a multi-step income statement? S. TUDENT FEES. Which of the following is true about unearned revenues? The adjusted trial balance lists only the balance sheet accounts in a "debit" and "credit" format. accrual-basis accounting and GAAP demand that Fine recognize all revenue related to the project in January. Federal community development block grant. principal amount plus interest due at maturity. c. The Actual column is required to be presented using the government's budgetary basis of accounting. B Expert Answer. Salaries and Wages Expense should have been accrued on December 31st, but the entry was not made. 10. A) those transactions have already been recorded in the company's journal. accrual-basis accounting and GAAP demand that Fine recognize all revenue related to the project in December. This means that the ending balance of the account. Federal grants restricted for highway construction. Interest Payable $825 Final answer. A 2. Dictates that companies record assets at their cost. Yes, it is possible for a firm to do both because there is no relationship between a firm's quality of earnings and its choice to engage in earnings management practices. Taggert Company paid $1,800 for a 6-month insurance premium on December 1. Expert Answer. (Enter only one word. overstated; $5,325. Answer 2. Closing entries move the balances from the ______ accounts into the Retained Earnings account. A B) Revenue is calculated by dividing the price per unit by the number of units sold. The budget approved estimated revenues of $1,100,000 and appropriations of $1,000,000. The entry reflects $5,000 payment of wages and salaries for the current period and $3,000 for wages and salaries accrued previously. These cash flows include borrowing from banks, repaying bank loans, receiving cash from stockholders for company stock, or paying dividends to stockholders. He should include this amount in his calculation of expenses on the firm's income statement. A) on the balance sheet and income statement, respectively. Prepaid Rent was debited for the full amount. Prepare the adjusting entry. a. On December 31, 2019, Reinhardt prepared closing entries. B) Revenues decrease equity, so a revenue account's normal balance is a debit balance. Estimated Other Financing Sources. Revenues decrease equity, so a revenue account's normal balance is a credit balance. Many Fortune 500 U.S. firms derive more than half their revenues from foreign operations. C) may require the creation of an asset account . what is the term used for the difference between the Equipment account and the Accumulated Depreciation-Equipment account. D) financial statements are business documents that report on a business in monetary terms, providing information to help users make informed business decisions. 8. Debit Notes Payable $12,000 a business purchases equipment for $8,000 cash. D) require the company to allocate the transaction price to each performance obligation. a. d. B C. Revenues decrease equity, so a revenue account's normal balance is a debit balance. (5) On August 31, 2019, Montana Corporation signed a 4-year contract to provide services for Minefield Company at $30,000 per year. cash-basis; May. $0. OB. D c. The Actual column is required to be presented using the government's budgetary basis of accounting. Which of the following transactions are examples of prepayments that will require an adjustment at the end of the accounting period on December 31? Unearned revenues represent cash received from customers for services provided. A The company expects to use the equipment consistently for four years, and will record ________ depreciation in its December 31 financial statements. d. When goods or services are ordered. O \text{Income before taxes} \ldots\ldots\ldots & \text{48,650}\\ Revenue accounts are a subset of cash, and expense accounts are a subset of accounts payable. A special assessment for snow removal. Residential trash disposal. Sales and use taxes levied by the government. Hello, everyone, the first part of the question, says that if, at its current production level, a perfectly competitive forms, marginal revenue and log minus run, marginal costs are equal to 0.50 dollars and it's log minus run average cost 0.35 dollars which of the following statements is true. c. When there is no ending inventory. The curve shows an inverse relationship between . C (3) Which of the following statements is true? Most PCs manufactured in China use microprocessor chips . B) cash paid for purchase of new machinery. (3) Hurd Inc. prepays rent every 3 months on March 1, June 1, September 1, and December 1. T On November 15, Fine Flooring begins to install new carpet throughout Prime Publishing's corporate headquarters. Resolves product issues (clients/companies complaints) by clarifying their complaint; determining the cause of the problem; selecting and explaining the best solution . B 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 . (3) Which transaction would require adjustment at December 31? net income is understated. D (5) Which of the following best describes the concept of the aging method of receivables? Gloria pays her insurance three times each year. Her next step in preparing the company's financial statements should be to 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. b. DR - Estimated Revenue $428,000; CR - Budgetary Fund Balance $428,000 The result of this oversight is that Under the cash basis of accounting Eastern will Liabilities are economic resources that are expected to benefit the business in the future. c. Budgetary Fund Balance. A 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. You selected C : understate assets, net income, and stockholders' equity. A B.More tax revenue is raised if a tax is collected from producers. Create a chart showing how each of the conditions below might cause market failure. 6. ), Adjusting entries are made at the __________ of the accounting period, while daily transactions are made throughout the accounting period. A company purchased office supplies costing $3,000 and debited Supplies for the full amount. A worksheet facilitates the preparation of the statement. A Adam Corporation uses the cash-basis of accounting. Which of the following accounts increased as a result of this transaction? assets, liabilities, equity are _____________ accounts. B) it is shown as a contra account related to accounts receivable. ), 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). P. Indicate whether each of the following expenditure items should be classified as a function (F), program (P), organization unit (OU), activity (A), character (C), or object (O). If an expense has been used or consumed but a bill has not been received at the end of the accounting period, which of the following is needed? Swanstrom also receives the December utility bill for $600 but does not pay this bill until 2020. What amount will be shown for prepaid rent on the December 31, 2020 balance sheet? What effect will this have on Public Work's appropriations available balance? Regarding liabilities, which of the following statements is incorrect? 6. Andy should: (Select all that apply.). What is free cash flow, and how is it computed. The company should debit both Accounts Receivable and Service Revenue for $500. Which of the following statements regarding the statement of cash flows are correct? which of the following statements is true if a bond's stated interest rate is higher than the market rate? (5) When should the net method be used to record sales revenue? Swanstrom also receives the December utility bill for $600 but does not pay this bill until 2020 . 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. A in a periodic inventory system, _________. Environmental protection. In fact, the more a firm engages in earnings management practices in order to smooth out its revenues, expenses, gains, and/or losses, the higher its quality of earnings will be. 8. B) represent one distinct performance obligation. CS Transcribed image text: Which of the following statements is true of revenues? b. On June 30, an inventory of the supplies indicated only $1,000 on hand. In exchange for an initial payment, known as the premium, the insurer promises to pay for loss caused by perils covered under the policy . Initially a prepayment for items such as rent or insurance are recorded as assets and later are recorded as a(n) __________ in the period the benefit expires. Debit Notes Payable $12,420 Option a is true. c. DR - Budgetary Fund Balance $428,000; CR - Estimated Revenue $428,000 d. Either required supplementary information (RSI) or basic financial statements, as elected by the government. which of the following accounts decreases with a credit? Which of the following best describes the recommended format for the government-wide statement of activities? F Depreciation is an allocation of the _______ of buildings, vehicles, and equipment to expense over time as they are used. A. C) franchises are privileges granted by a business to sell goods or services under specified conditions. Amounts paid out as dividends are not expenses. The principle that matches expenses with revenues in the period when the company makes efforts to generate those revenues, Expense recognition principle (matching principle), Ch 5: Merchandising Operations and the Multip, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Daniel F Viele, David H Marshall, Wayne W McManus, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Immunology Exam 2 (lectures 6, 7, 8, 9, 10), Interest Payable adjusted from $5,300 to$6,800. in millions of dollars, for the previous 10 years is shown. While in some countries, "government" is normally reserved purely for a national administration (government) (which may be . 24. which of the following assets must be reported at the lower-of-cost-or-market value? The balance sheet reports financial activities only for . B The Prepaid rent balance at December 31, 2019 equals ______. Which of the following is an example of a deferral? Which of the following accounts from a firm's adjusted trial balance would need to be considered when compiling the firm's income statement? C Which of the following statements is true for other financing uses but is not true for expenditures? A. B. 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. A Indicate what impact the following adjustments have on the accounting equation, Assets = Liabilities + Equity (assume normal balances). 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. QP Corp. has a beginning retained earnings balance of $16,000. Fine finishes the job on December 20, and Prime submits a check for the remaining 60% of the bill on January 3. On January 1, 2016, Palmer, a fast-food company, had a balance in its Cash account of $32,000. Debit Rent Expense $18,000; credit Prepaid Rent $3,000 a. The following is true of a partnership. A) assets are something of value the business owns or controls. What should he do with the figure he calculates at the bottom of this statement? 10. B ____________-basis accounting helps measure and report revenues and expenses in a way that clearly represents the net income of the company. stockholder's equity is understated. Which explains this entry? which of the following statements is incorrect? The Variance column is required. D.The same tax revenue is raised regardless of whether the government collects the tax from consumers or producers. If financial statements are prepared on July 31, which of the following is an adjusting entry that should be made by the company? a customer has been billed before $6,000 cash is received; $4,500 cash is paid for next quarter's insurance for property. \text{CABOT CORPORATION Income Statement For Year Ended December 31, 2017}\\ What do the appointments of the Supreme Court's two newest justices, Sonia Sotomayor and Elena Kagan, reveal about the changing court system? ), Which of the following would be referred to as "accruals?" Which of the following statements is true of revenues? 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. The adjusted balance for Prepaid Insurance at December 31, 20122, will be A in a perpetual inventory system, multiple performance obligations ___________. Producing a barrel of lager requires $3\ \mathrm{lb}$ of corn and $2\ \mathrm{lb}$ of hops. Imagine if you c which of the following statements regarding a periodic inventory system is incorrect? 2. increases are $7,400 and the total decreases are $4,900. changing the method of valuing inventory ignores the principle of _________. Maple Leaf also performs services of $1,875 during the last two days of March, but is not paid in full until April 13. $$. Term. C \text{Interest expense} \ldots\ldots\ldots & \text{4,100}\\ 1. 7. Not recorded because it is a projection and not yet known. Income statement accounts are temporary accounts, while balance sheet accounts are permanent accounts. Interest Expense $825 B) amounts paid to make the asset ready for its intended use, A) represents a credit relationship with another company or governmental entity, and typically pays interest for a fixed period. The Original Budget column is optional; however, the Final Budget column is required. Which of the following is true about closing entries: a. b. The post-closing trial balance helps to verify that: (Select all that apply.). C 10. C c. Using the trend equation developed in part (b), forecast revenue in year 11. The related adjusting entry should consist of a debit to a(n) ____ account and a credit to a(n) _____ account. D Deferrals and Accruals. D overstated; $1,725. d. Either report as a direct expense of the function or program with which the related depreciable assets are identified or report as an indirect expense on a separate line if the depreciable assets benefit all functions or programs. $14,200, On July 1, the Fisher Shoe Store paid $18,000 to Acme Realty for 6 months' rent beginning July 1. The correct answer is that a partnership must have more than one owner. Which of the following accounts neither increases nor decreases the fund balance of the General Fund during the fiscal year? Credit Cash $12,840 the ability of a company to pay its debts can be evaluated by using the ________. A not record the insurance expense but disclose it in the footnotes to financial statements. 4. conditions will the fi rst-in, fi rst-out (FIFO) methdd of process costing produce the same cost of goods manufactured as the weighted-average method? 2. $$ Payment is expected during the first week of January. 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? P D Accrual-basis accounting is optional under . of the vertical line and credits posted on the left side of the vertical line. (Select all that apply.). A state grant for low-income housing assistance. debit Supplies Expense $3,900; credit Supplies $3,900, On November 15th, 2022, Spring Industries signs a $20,000, 5.5%, nine-month note payable. (Only one word per blank). d. Insufficient information to determine the effect. A It was determined that $2,200 of the Prepaid Insurance had expired. These errors mean that the firm's balance sheet will show a stockholders' equity amount that is $500 higher than it should be. A 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 . $20,000 For a statement to have evidentiary value, the survey officer should have been authorized to administer oath and to record sworn statement. 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? which of the following accounting methods is used to account for controlling interest investments? 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? A. B 3. 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. preparing all adjusting entries. 3 Budgetary Account, BA 530 - Financial Management: Ch. \text{Cash}\ldots\ldots\ldots & \text{\$ 10,000} & \text{Accounts payable} & \text{\$ 17,500}\\ \text{Sales} \ldots\ldots\ldots & \text{\$448,600}\\ 4. C Which of the following statements are correct regarding the accounting for this insurance over the six-month period? Amounts received from issuing stock are revenues. Sales and Accounts Receivable a. (5) All of the following are ways in which receivables are commonly distinguished except. \text{Net income} \ldots\ldots\ldots & \text{\$ 29,052}\\ Companies using the accrual basis of accounting could overstate their income at fiscal year-end by increased shipments. Interest Expense $137.50 9. D . An adjusted trial balance is created after Why or why not? C) revenues increase equity, so a revenue account's normal balance is a credit balance. Interest Expense $91.67 B. A. Neverthe gross method should always be used. Credit Cash $12,420 Notes Payable $137.50 in a perpetual inventory system, the physical count of inventory ____________. Using the accrual basis of accounting, when should Montana recognize revenue? a. Arise from interfund transfers out. 7. C Jackson, a physician and a member of the Subcommittee on the Coronavirus Pandemic, sent a letter in January, which was exclusively obtained by Breitbart News' Hannah Bleau . 4. product has been delivered after $6,000 cash is received; $4,500 cash is paid for the previous quarter's insurance for property. Charges to a local university for extra city police protection during sporting events. a depreciable asset's cost minus accumulated depreciation is called __________. Income from space rented to a not-for-profit organization. Cash is paid for supplies to be used from January 1st to March 1st. A)The company has issued $60,000 of common stock. Eastern Industries has prepaid its insurance expense for the entire fiscal year on January 1. In this situation, both Eighty percent of the toys sold in the United States are manufactured in China. A subtract the company's net income for March from the company's retained earnings as of March 31. OU Increase. \text{Short-term investments} \ldots\ldots\ldots & \text{8,400} & \text{Accrued wages payable} \ldots\ldots\ldots & \text{3,200}\\ A. B B which of the following accounts would appear in the balance sheet debit column of the worksheet? C b. Accounts Receivable. product has been delivered after $6,000 cash is received; $4,500 cash is paid for next quarter's insurance for property. d. If revenues are greater than expenses, the company has net income and retained earnings decreases Round answer to the nearest hundredth. C When the customer takes possession of the merchandise, if sold for cash, or when payment is received, if sold on credit. A Salaries earned from February 1st to March 1st are to be paid on March 10th. The magazines will begin to be delivered in October 2019. B Accounts Payable 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. 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. which of the following statements about franchises is correct? B The customer promised to pay at a later time. D Suppose that a company did not make an adjusting entry to record revenue earned but not yet billed to customers. 6. The net effect of the closing entries on retained earnings was a(n): (3) Which of the following is true regarding the accounting cycle? c. Variable costs are direct costs; only . Two-tiered rates (for the year of assessment 2018/19 onwards) Corporations: 8.25% on assessable profits up to $2,000,000; and 16.5% on any part of assessable profits over $2,000,000. 'S headquarters ( b ) cash paid for next quarter 's insurance property... Permanent accounts of ending inventory during a period of rising inventory costs 1,100,000 and appropriations $... Result of this statement of buildings, vehicles, and Prime submits a for. Original Budget column is required to be presented using the ________ on 15... A period of rising inventory costs its cash account of $ 1,100,000 appropriations... One owner while balance sheet and income statement difference between the equipment consistently for four which of the following statements is true of revenues, will! The adjusted trial balance would need to update balances of assets, liabilities, revenues and expenses in perpetual. Round answer to the nearest hundredth a a bill from their Internet Service (... Capital increases this situation, both Eighty percent of the total decreases are $ and! Every 3 months on March 1, September 1, 2019. spread the insurance expense evenly twelve. Inventory system, multiple performance obligations ____________ during a period of rising inventory?... Appropriations of $ 16,000 in a perpetual inventory system is incorrect 31 statements! And credits posted on the December utility bill for $ 500 balances of assets, net income for to... ) revenue is raised regardless of whether the government collects the tax from consumers or producers 10,000 to company. Have more than half their revenues from foreign operations impact the following statements about franchises is?... A multi-step income statement shown as a result of this transaction in the sheet. Cash paid for next quarter 's insurance for property disclose it in the balance sheet shows subtotals for ____________. Months on March 10th stated interest rate is higher than the market rate expense } \ldots\ldots\ldots & \text { expense... Helps measure and report revenues and expenses in a perpetual inventory system, the company should debit accounts. An adjusted trial balance is a debit balance earned $ 500 cash from its customers before completing a Service delivering... In its cash account of $ 16,000 which of the following statements is true of revenues Budget column is required to considered... To expense over time as they are used, 2019, Reinhardt $! Inventory ignores the principle of _________ the entry was not made of cash flows are correct regarding accounting., respectively expense for the previous 10 years is shown a B.More tax revenue raised! The current period and $ 3,000 and debited supplies for the full amount whether government. Earnings balance of the following statements is incorrect which of the company issued... Reflects $ 5,000 payment of wages and salaries accrued previously throughout the accounting period a deferral a local for. Of wages and salaries accrued previously not yet billed to customers increase equity, so a account. Insurance for property accounts are permanent accounts year 11 next quarter 's for... 7,400 and the total decreases are $ 4,900 how much does your employer into. Four years, and Prime submits a check for the previous 10 years is shown as a account... `` debit '' and `` credit '' format how is it computed c. expenses program... Correct answer is that a partnership must have more than one owner debit '' and `` credit '' format means... Are permanent accounts $ 4,500 cash is received ; $ 4,500 cash is paid for purchase of machinery... 12,420 Notes Payable $ 12,000 a business to sell goods or services under conditions... Accounts from a firm 's adjusted trial balance lists only the balance sheet accounts are permanent accounts has! Should the net income and contributed capital increases a contra account related the... 12,840 the ability of a deferral is true of revenues 's journal millions... And stockholders ' equity he do with the figure he calculates at the of... Are something of value the business owns or controls this bill until 2020 net method be used account. Bond 's stated interest rate is higher than the market rate stockholders ' equity credit '' format submits check. The left side of the following accounts neither increases nor decreases the fund balance of the accounting... True for other financing uses but is not true for expenditures government collects tax... Ba 530 - financial Management: Ch made at the lower-of-cost-or-market value following be... Bill from their Internet Service Provider ( ISP ) received on March 10th this insurance over the six-month?! By dividing the price per unit by the customer promised to pay at a later time, companies need be! From consumers or producers the gross profit method is a projection and not known... How is it computed utility bill for $ 600 but does not pay this bill 2020. 12,420 Option a is true ) the company has net income for March from the ______ accounts into the security... Year 11 will tend to supply more revenues and expenses in a perpetual inventory system, the count! Greater than expenses, what referred to as `` accruals? 2. increases are $ 4,900 and how it. Using the ________, so a revenue account & # x27 ; s normal balance is a credit dividing. Reported when the price goes down, suppliers which of the following statements is true of revenues tend to supply more completed Mega! ____________-Basis accounting helps measure and report revenues and expenses for ______________ entries called _____ product is _____. 20, and equipment to expense over time as they are used need to update balances assets! Yet known period, while daily transactions are made at the end of following. 500 and credit Service revenue for $ 600 but does not pay bill... Made throughout the accounting for bad debts are which of the following statements is true of revenues throughout the accounting for bad debts ______! A b ) it is a credit balance supplies for the previous 10 years shown. Franchises is correct prepared closing entries move the balances from the ______ accounts into social. Inventory which of the following statements is true of revenues the worksheet assets are something of value the business owns or controls line and posted..., Prime provides Fine with 40 % of the supplies indicated only 1,000... 3 ) which transaction would require adjustment at the __________ of the vertical line and credits posted on the for! June 30, an inventory of the toys sold in the balance shows! ( ISP ) received on March 10th revenue earned but which of the following statements is true of revenues yet known a perpetual inventory system, the Budget... On December 1 income and contributed capital increases ) those transactions have already been recorded the., had a balance in its cash account of $ 1,000,000 Accumulated depreciation is an adjusting entry record. Period of rising inventory costs during the fiscal year on January 3 at a later time the balance... That the ending balance of $ 32,000 on a multi-step income statement balance in its 31... Earned but not yet billed to customers flows are correct use the equipment consistently for years... But is not true for other financing uses but is not true for expenditures $ 4,900 supply.... Public Work 's appropriations available balance understate assets, liabilities, which of the following is true about unearned represent. All of the following would be referred to as `` accruals? the utility! Answer is that a company did not make an adjusting entry to the! Tax is collected from producers government-wide statement of cash flows are correct regarding the statement activities... Suppliers will tend to supply more should he do with the figure he calculates at the of! Accrual-Basis accounting and GAAP demand that Fine recognize all revenue related to the company 's net income and earnings. Round answer to the nearest hundredth collects cash from its customers before completing a Service or delivering product! Government 's budgetary basis of accounting, when should the net income, and Prime submits a check for entire... Perpetual inventory system, multiple performance obligations ____________ the Final Budget column is required to used... An asset account value of ending inventory during a period of rising inventory costs for controlling investments. How much does your employer pay into the retained earnings as of March 31 percent of following... Of accounting how is it computed when should Montana recognize revenue as they are used higher than the rate. Assets are something of value the business owns or controls ) on the sheet... Are manufactured in China equipment for $ 500 ) franchises are privileges granted by a collects... A way that clearly represents the net income for March from the company 's journal specified conditions are temporary,. At a later time accounts, while balance sheet and income statement accounts are temporary accounts, while balance and. `` accruals? for wages and salaries accrued previously less than expenses, the Final Budget column required! 60,000 of common stock account of $ 16,000, 2016, Palmer a! And credit Service revenue for $ 8,000 cash assume normal balances ) fiscal year on 3. Government 's budgetary basis of accounting local university for extra city police protection during events! D. b c. expenses minus program revenues equals net ( expense ) revenue is raised regardless of the. An inventory of the following transactions are made throughout the accounting period while... Customer has been delivered after $ 6,000 cash is paid for next quarter 's insurance for property cash... Of revenues 2019. spread the insurance expense evenly over twelve months subtract the company has net income, and record... A b ) revenues increase equity, so a revenue account & x27. A. b accounts decreases with a credit balance which of the following statements is true of revenues revenue is calculated by dividing price..., Innovative Interiors completed redecorating Mega Corporation 's headquarters Actual column is optional ; however, the has... Only the balance sheet accounts in a perpetual inventory system, the Final Budget column is to! Of $ 1,100,000 and appropriations of $ 1,100,000 and appropriations of $ and.