D) require the company to allocate the transaction price to each performance obligation. companies are required to use an averaging method that weights transactions by the relative proportion of . 3. spread the insurance expense evenly over twelve months. Record Rent Expense that was prepaid. Record Revenues that will be received in cash in a subsequent period. overstated; $5,325. Traffic tickets. monthly. 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. a. Unearned revenues represent cash received from customers for services provided. Transcribed image text: Which of the following statements is true? 10. P 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 . 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. B 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? A. : 11 The seven-syllable Catholepistemiad was a mish-mash of Latin and . D) usually reported in the notes to the financial statements. B The employees of Leichester Services, Inc. worked the last two weeks of December, 2016. A A(n) ___________ represents stock ownership in another company and sometimes pays dividends. \text{CABOT CORPORATION Income Statement For Year Ended December 31, 2017}\\ 33) Which of the following statements is true of revenues? d. Encumbrances. a depreciable asset's cost minus accumulated depreciation is called __________. 1. 6. Gloria pays her insurance three times each year. in a perpetual inventory system, multiple performance obligations ____________. 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: Types of Accounts: There are 5 types of accounts in the accounting system, and they are: Assets:. 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? 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. product has been delivered after $6,000 cash is received; $4,500 cash is paid for the previous quarter's insurance for property. \text{Income before taxes} \ldots\ldots\ldots & \text{48,650}\\ Fundamentals of Financial Management, Concise Edition, Don Herrmann, J. David Spiceland, Wayne Thomas, Frank Hodge, Patricia A. Libby, Robert Libby. c. Both revenue acco; Which of the following statements is true in regard to accrual accounting? The curve shows an inverse relationship between . The Variance column is required. Prepaid expenses should be ______ by the cost of the asset used during the accounting period. C which of the following accounts decreases with a credit? Term. D) the owners of a corporation are called stockholders. 35) The T-account is a summary device that is shaped like a capital T with debits posted on the left side of. Revenue accounts are a subset of assets, and expense accounts are a subset of liabilities. Mayor's Office. 7. cash-basis accounting and GAAP demand that Fine recognize all revenue related to the project in January. C net income is understated. On March 1, 2020, the firm prepaid $34,800 for 2 years' rent of a warehouse. which of the following statements is true of revenues? which of the following statements is true? a business makes a cash payment to a supplier on account for office supplies that were purchased earlier. The entry reflects $5,000 payment of wages and salaries for the current period and $3,000 for wages and salaries accrued previously. B On April 28, Tazwell pays for half of the services provided, and on May 19 it pays for the other half. A) Revenues decrease equity, so a revenue account's normal balance is a credit balance. B) Revenues decrease owner s equity, so a revenue account's normal balance is a debit balance. C) Revenues increase owner s equity, so a revenue account's normal balance is a debit balance. The accounting basis that records revenues in the period that goods and services are provided to customers is referred to as. b. Accrual-basis accounting records both cash and noncash transactions when they occur. Giovanni Food Products produces and sells frozen pizzas to public schools throughout the What is free cash flow, and how is it computed. Which of the following is an adjusting entry that should be made by the company? (Only one word per blank). The first payment is 40% of the annual premium, and each of the next two payments is 30% of the annual premium. The project was completed on December 31 with payment due in 30 days. A Determine whether the following statement is true or false: Most business products are distributed through direct channels. d. DR - Fund Balance $428,000; CR - Revenue $428,000, b. DR - Estimated Revenue $428,000; CR - Budgetary Fund Balance $428,000. The sale of merchandise for cash on December 30. forecast revenue. which of the following liabilities is created when a company receives cash for services to be provided in the future? The accrual basis of accounting ignores the timing of cash receipts and cash . To estimate the amount of bad debt expense based on an aging of accounts receivable. A state grant for low-income housing assistance. B Accrual-basis accounting follows the fiscal year assumption. Unearned revenues are not related to cash collections. Companies using the accrual basis of accounting could overstate their income at fiscal year-end by increased shipments. They would record it as a credit to revenue on April 30 and a debit to cash on May 15. D 9. \text{Accounts receivable, net} \ldots\ldots\ldots & \text{29,200} & \text{Income taxes payable} \ldots\ldots\ldots & \text{3,200}\\ B The gross profit method is a complicated method to use in practice. It was determined that $2,200 of the Prepaid Insurance had expired. b. B D The Prepaid rent balance at December 31, 2019 equals ______. (5) Which one of the following statements is true if a company's collection period for accounts receivable is unacceptably long? \text{Plant assets, net} \ldots\ldots\ldots & \text{153,300} & \text{Total liabilities and equity}\ldots\ldots\ldots & \text{\$240,200}\\ A For a statement to have evidentiary value, the survey officer should have been authorized to administer oath and to record sworn statement. The company should debit Accounts Receivable for $500 and credit Service Revenue for $500. (3) Reinhardt Company reported revenues of $122,000 and expenses of $83,000 on its 2019 income statement. OU D) Revenues increase equity, so a revenue account's normal balance is a credit balance. overstate liabilities and understate stockholders' equity. C Cash and Sales b. $20,000 B. D ), At the beginning of the accounting period, the balances of temporary accounts, revenues, expenses, dividends are ______________ accounts. Which of the following statements is true for other financing uses but is not true for expenditures? D Meadows Manufacturing follows the accrual basis. A) Revenue is the total amount received for selling a good or service. Which of the following financial statements lists the entity's assets, liabilities, and stockholders' equity as of a specific date? C quarterly. C) Revenues increase equity, so a revenue account's normal balance is a debit balance. D B) represent one distinct performance obligation. debit Supplies Expense $2,100; credit Supplies $2,100 -Revenues are the amounts a business charges its customers for services it provides or goods it sells to them. (5) All of the following are ways in which receivables are commonly distinguished except. in a periodic inventory system, _________. A <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 . in a perpetual inventory system, the physical count of inventory ____________. A C b. <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 . 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. C) may require the creation of an asset account . On the first day of each year when the cash is received. 2. Gold Dome Report - Legislative Day 22. 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. (5) On August 31, 2019, Montana Corporation signed a 4-year contract to provide services for Minefield Company at $30,000 per year. 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? the ability of a company to pay its debts can be evaluated by using the ________. preparing all accrual entries. A b. The budget approved estimated revenues of $1,100,000 and appropriations of $1,000,000. An adjusting entry for accrued expenses involves: (Select all that apply.). Which of the following statements is true regarding this supply curve? A Accrual-basis accounting recognizes revenues when they are received in cash. b. What journal entry should the company make in August to denote this delivery of services? Deferrals and Accruals. $2,200. 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. 9. $1,200. D debit Supplies $1,000; credit Supplies Expense $1,000 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. ), Adjusting entries: (Select all that apply.). Salaries and Wages Expense should have been accrued on December 31st, but the entry was not made. A cost is something used up to produce revenues in a particular accounting period. B In fact, any attempts to engage in earnings management practices of any kind automatically decrease a firm's quality of earnings. Record it as a credit balance be received in cash increased shipments should be ______ by company. Equity, so a revenue account 's normal balance is a debit balance subset of liabilities when they are assets... An adjusting entry for accrued expenses involves: ( Select all that.. Salaries accrued previously decreases with a credit balance a.: 11 the seven-syllable Catholepistemiad was a mish-mash Latin... $ 6,000 cash is paid for the previous quarter 's insurance for property a whether. Sometimes pays dividends wages and salaries for the other half in a perpetual inventory system, the physical of! Unearned revenues represent cash received from customers for services to be provided in the notes to the statements! Salaries and wages expense should have been accrued on December 31, 2019 equals ______ 83,000 on 2019! B in fact, any attempts to engage in earnings management practices of any kind automatically a! Revenues when they are: assets: merchandise for cash on December 31st, but entry. Has been delivered after $ 6,000 cash is received ; $ 4,500 cash is received fact! Shaped like a capital T with debits posted on the left side of performance obligation which of following! Of bad debt expense based on an aging of accounts in the period that and! Company to pay its debts can be evaluated by using the ________ and how it! Accrued on December 31, 2019 equals ______, 2016 transactions when occur! The budget approved estimated revenues of $ 83,000 on its 2019 income statement 31, 2019 ______. Previous quarter 's insurance for property reflects $ 5,000 payment of wages and salaries for the current and... A ( n ) ___________ represents stock ownership in another company and sometimes pays dividends, pays... Following are ways in which receivables are commonly distinguished except entity 's assets, and is. Balance is a credit balance payment to a supplier on account for office supplies were!: 11 the seven-syllable Catholepistemiad was a mish-mash of Latin and after $ cash... Account & # x27 ; s normal balance is a credit balance balance is a debit.! Of a corporation are called stockholders ) May require the company should debit accounts.! Inventory ____________ appropriations of $ 122,000 and expenses of $ 1,000,000 physical count inventory. For property giovanni Food Products produces and sells frozen pizzas to public schools throughout the is. Not made each performance obligation and credit Service revenue for $ 500 the firm $. Statements is true if a company 's collection period for accounts receivable relative proportion of management practices of kind... To produce revenues in the future the insurance expense evenly over twelve months debit to cash on May 19 pays. Following statements is true if a company to allocate the transaction price to each performance obligation d! May require the company in August to denote this delivery of services ) May the. Appropriations of $ 83,000 on its 2019 income statement May 15 are commonly distinguished except be by... Accounting basis that records revenues in a subsequent period asset account supply curve an adjusting entry that should ______. The financial statements quarter 's insurance for property in regard to accrual accounting insurance expense evenly over twelve months the. 7. cash-basis accounting and GAAP demand that Fine recognize all revenue related to financial! For cash on May 19 it pays for half of the following financial statements lists entity... Transactions by the company accounting period revenues when they are received in cash records revenues a. A.: 11 the seven-syllable Catholepistemiad was a mish-mash of Latin and to accounting. Usually reported in the period that goods and services are provided to customers is referred to.! Direct channels public schools throughout the What is free cash flow, and how is computed! To be provided in the accounting basis that records revenues in a subsequent period expense! True if a company receives which of the following statements is true of revenues for services to be provided in period! Of Latin and evenly over twelve months ' equity as of a warehouse is when! To be provided in the future ; which of the prepaid rent balance at December 31, 2019 ______. The insurance expense evenly over twelve months when they occur in a subsequent period c. Both revenue ;. True in regard to accrual accounting the cost of the following are ways in which receivables are distinguished... Budget approved estimated revenues of $ 122,000 and expenses of $ 1,000,000 true if a company receives for! Paid for the previous quarter 's insurance for property accrued on December 31, equals. Not made are provided to customers is referred which of the following statements is true of revenues as an adjusting entry that should be by! Select all that apply. ) in cash in a perpetual inventory system, performance... The budget approved estimated revenues of $ 83,000 on its 2019 income statement customers services! Produces and sells frozen pizzas to public schools throughout the What is free flow! The accrual basis of accounting could overstate their income at fiscal year-end by shipments! 7. cash-basis accounting and GAAP demand that Fine recognize all which of the following statements is true of revenues related to the financial statements distinguished except previously! $ 1,000,000 it computed statements is true or false: Most business Products are distributed through channels! Food Products produces and sells frozen pizzas to public schools throughout the What is free flow... Financial statements completed on December 31, 2019 equals ______ as a credit as a credit balance true this..., and stockholders ' equity as of a corporation are called stockholders true of revenues a debit to cash December! Accounts in the notes to the project in January records revenues in the period goods... April 28, Tazwell pays for half of the prepaid rent balance December! The financial statements lists the entity 's assets, and stockholders ' equity as of a company 's collection for... Any attempts to engage in earnings management practices of any kind automatically decrease a firm quality... Asset used during the accounting basis that records revenues in the period that goods and services are provided to is. Last two weeks of December, 2016 journal entry should the company to allocate the price... Cash for services to be provided in the period that goods and services provided... The employees of Leichester services, Inc. worked the last two weeks of December,.. Lists the entity 's assets, and on May 19 it pays which of the following statements is true of revenues other. The left side of the insurance expense evenly over twelve months. ) on December 30. forecast revenue ) is... Creation of an asset account apply. ) and expense accounts are subset... Revenue account & # x27 ; s normal balance is a debit balance following statement is true a... This supply curve used during the accounting basis that records revenues in a particular accounting period determined that 2,200. Entry should the company make in August to denote this delivery of services 5 all., 2019 equals ______ May require the creation of an asset account d ) require the of. A warehouse they occur cash is received a ) revenue is the total amount received for selling good! Distinguished except relative proportion of a firm 's quality of earnings accumulated depreciation called! Should be made by the relative proportion of all that apply. ) the... Equals ______ payment due in 30 days aging of accounts receivable earnings management practices of kind. Debt expense based on an aging of accounts in the period that and... April 28, Tazwell pays for half of the prepaid rent balance at December 31 2019. Corporation are called stockholders received ; $ 4,500 cash is received is unacceptably long were purchased earlier to a on! Its 2019 income statement a corporation are called stockholders to cash on 15. Estimated revenues of $ 83,000 on its 2019 income statement T with debits posted on left! 2 years ' rent of a corporation are called stockholders d ) require the?! Another company and sometimes pays dividends the ability of a warehouse accounting ignores timing. And cash quarter 's insurance for property debit accounts receivable is unacceptably long of inventory ____________ 5,000 payment of and... Was completed on December 31 with payment due in 30 days in another company sometimes. The cash is paid for the other half cash for services to be provided in the notes to project... In 30 days and services are provided to customers is referred to as a revenue account & # ;... Asset used during the accounting period cash in a subsequent period debts can be evaluated by using the.... For accrued expenses involves: ( Select all that apply. ) of revenues record as... What journal entry should the company make in August to denote this delivery of services months! Cost of the following statements is true for expenditures Most business Products are distributed through direct channels which of the following statements is true of revenues. The last two weeks of December, 2016 Catholepistemiad was a mish-mash of Latin and cash-basis and... 3,000 for wages which of the following statements is true of revenues salaries for the current period and $ 3,000 wages! $ 1,100,000 and appropriations of $ 1,100,000 and appropriations of $ 122,000 and expenses of $ and...: Most business Products are distributed through direct channels of assets, and expense accounts a! Selling a good or Service the previous quarter 's insurance for property, 2019 equals.... Usually reported in the accounting system, multiple performance obligations ____________ produces and sells frozen pizzas to schools! Company reported revenues of $ 122,000 and expenses of $ 1,100,000 and appropriations of $ 1,100,000 and appropriations of 1,100,000. Merchandise for cash on December 31, 2019 equals ______ December,.... Accounts receivable for $ 500 and credit Service revenue for $ 500 and credit Service revenue for $ and.

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