Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Garcia Company rents out a portion of its building to Jerry Company for 1,000 per month. On July 1 of the current calendar year, Plum Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. Interim financial statements report a company's business activities for a one-year period. A:Net Sales are the total Sales after all adjustments made for any discounts made available to custome Q:How much shall be reported as interest income for 2022? \text{Accounts receivable} &181 &170\\ Copyright 2019 McGraw-Hill Education. in a future period. The difference between the cost of an asset and the accumulated depreciation for that asset Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Trekker Bikes' current assets are $300 million and its current liabilities are $125 million. Net Loss $33,600 C) A debit to an expense and a credit to a prepaid expense for $1,875. For the year ended December 31, a company had revenues of $196,000 and expenses of $117,600. ifferences would likely exist in your own behavior if you were in a contingent or temporary job versus a traditional permanent job? $6,000 $3,600 = $2,400. August 31, the fiscal year-end, the physical count of supplies indicates the cost of unused sheet account, and never cash. E) None of the answer choices is correct. Thus in collateral Q:AJUMA Farms operates a farm with various plants E) None of the answer choices is correct. General Ledger balance Supplies on hand = Supplies used relevant range of production =10000 to 20000 units Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $1,225. On July 1, a client paid an advance payment (retainer) of $10,000, to cover future legal services. B) Collateral trust bond: Collateral means additional security. Debit Interest Receivable, 3,360; credit Interest Revenue, $3,360 are earned and matching expenses to those revenues is: Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded. A) Store fixtures. On December 1, Milton Company borrowed $380,000, at 9% annual interest, from the Tennessee National Bank. A red flag is a warning which suggests that there is a potential problem with company's Q:A purchasing Department purchased the following items at the given list prices & trade , resources priorities training? On September 1, Kennedy Company loaned $112,000, at 9% annual interest, to a customer. Journalize the adjusting entry required at the end of the year, assuming the amount of unexpired insurance related to future periods is 7,360. Chapter 3 Adjusting Accounts for Financial Statements. The cash basis of accounting commonly increases the comparability of financial statements A) Profit margin reflects the percent of profit in each dollar of revenue. Copyright 2019 McGraw-Hill Education. It is also known as General Ledger. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The periodic expense created by allocating the cost of plant and equipment to the periods in coverage began on February 1. A company had revenues of $51,000 and expenses of $41,750 for the accounting period. A company pays its employees $3,800 each Friday, which amounts to $760 per day for the five-day workweek that begins on Monday. D) Assuring that financial statements reflect the revenues earned and the expenses incurred. C) An unearned revenue on the income statement. What is the correct closing entry for the expense accounts? *. D) Net income divided by assets. The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for National Intercable Company. Key word, is AFTER adjusting and reversing entries were made on Dec 31 and Jan 1. A) Intangible expenses. On July 1, a client paid an advance payment (retainer) of $5,000 to cover future legal services. \text{Deferred tax liability}& 18& 15\\ f. $130 million of bonds were retired at maturity. A debit to a prepaid expense and a credit to an expense for $1,925. E) A financing activity on the statement of cash flows. there are no unearned revenues in accrual accounting. Copyright 2019 McGraw-Hill Education. You can specify conditions of storing and accessing cookies in your browser. C) The time period assumption. Adjusting entries are designed primarily to correct accounting errors. C) A debit to a prepaid expense and a credit to Cash for $7,500. On July 1 Olive should record: Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. Copyright 2019 McGraw-Hill Education. The The fir A:Note: 1/10, n/30: Here, 1 represent the discount rate if payment is made within ten days. What is the correct closing entry for the revenue accounts? B) Unearned Depreciation. The revenue recognition principle is the basis for making adjusting entries that pertain to Recording expenses early overstates current-period income; recording expenses late A company purchased On August 1, Jerry paid Garcia 12,000 for 1 year of rent in advance. D) Profit margin is calculated by dividing net income by net sales. Prior to recording adjusting entries, the Office Supplies account had a $388 debit balance. C) $13,000. amounted to $3,500. Select one: The balance in the Retained earnings account before closing is $83,000. NATIONALINTERCABLECOMPANYIncomeStatementForYearEndedDecember31,2021($inmillions)RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome$32015512555251730422984220$22$340. The retained earnings account before closing had a balance of $303,000. recording all prepaid expenses to asset accounts at the time of cash payment. paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. Dividends 41,000, $179,000 It is acceptable to record cash received in advance of providing products or services to be prepared to record the $3,000 payment of salaries in January of the following year? D) Affect cash accounts. $33,400 A company performs 20 days of work on a 30-day contract before the end of the year. Cash paid on July 1, for services to be performed over next 2 A debit to a prepaid expense and a credit to Cash for $7,500. Debit Income Summary $51,000; credit Revenues $51,000. Question: Check my work On July 1 of the current calendar year, Olive Co. paid $7700 cash for management services to be performed over a two-year period beginning July 1 Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Supplies on hand at July 31, 615. A company's post-closing trial balance has total debits of $40,560 and total credits of < Prev update a related expense or revenue account. A). Closing entries are designed to transfer the end-of-period balances in the revenue accounts, . \text{Bad debt expense} &7\\ A company had $6,992,000 in net income for the year. What is the adjusting entry for accruing interest that Milton would need to make on December 31, the calendar year-end? Become Premium to read the whole document. E) A credit to a liability and a debit to a prepaid expense for $1,875. In this case, the adjusting entry for accrued revenue on December 31 should be: This site is using cookies under cookie policy . Net operating income (NOI) decides an element's or alternately property's inco Q:Assume Rajan Manufacturing Ltd makes sports vest for local soccer, baseball, basketball, and other s Q:Which of the data above should be ignored in making the special-order decision? An expense account is normally closed by debiting Income Summary and crediting the A company entered into a 2-month contract for $50,000 on April 1. The adjusting entry on December 31 of the current year for Olive would include: Multiple . The main purpose of adjusting entries is to: Assuming adjusting entries are only made at year-end, the \text{Accounts payable}&\$ 30& \$ 45\\ A company records the fees for legal services paid in advance by its clients in an account the accounting period. Capital of A and B are in excess of average investment. During the period, the company completed $6,200 of the agreed-on services for the client. This is a Premium document. E) 33%. Each adjusting entry will affect a balance sheet account. Under the effective interest method , the bond is recognized using the pres Q:4. A ledger is an account that provides information on all the transactions that have taken place during a particular period. What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? 20 Net Price = List price - Trade discount. A company purchased new furniture at a cost of $34,000 on September 30. The year-end adjusting entry on Its profit margin is: (A reconciliation schedule is not required.). 22,250 If a company has current assets of $15,000 and current liabilities of $9,500, its current ratio Asset and liability balances are transferred from the adjusted trial balance to the balance C) Unearned expenses. In its first year of operations, Grace Company reports the following: Earned revenues of : an American History (Eric Foner), Principles of Environmental Science (William P. Cunningham; Mary Ann Cunningham), Educational Research: Competencies for Analysis and Applications (Gay L. R.; Mills Geoffrey E.; Airasian Peter W.), Business Law: Text and Cases (Kenneth W. Clarkson; Roger LeRoy Miller; Frank B. Q:Several items are omitted from the income statement andcost of goods manufacturedstatement data fo A:Direct materials used= Materials beginning + materials purchased - materials ending in come statement for the first year ended December 31? On July 1 Olive should record: A) A debit to an expense and credit to a prepaid expense for $7,500. C) The expense recognition (matching) principle. A) Debit Unpaid Salaries and credit Salaries Payable. $112,000 0.09 4/12 = $3,360. A) Is referred to as depreciation expense. books of Kingsley Ltd.: The Freudian concept of the ego is best described as a. operating on the reality principle. Actual price per meter = $382,500/62,500 m \text{Land} &150 &150\\ B) A debit to Rent Revenue and a credit to Unearned Rent for $2,400. B) Items that require adjusting entries. The retained earnings account before closing had a balance of $298,000. A debit to an expense and credit to Cash for $7,500. E) 46%. At the balance sheet date, a business owes a mortgage note payable of 375,000, the terms of which provide for monthly payments of 1,250. Retained earnings 110,000 And if pay Q:) Refer to the following data: On July 1, a company paid the $2,280 premium on a one-year insurance policy with benefits beginning on that date. After closing entries are posted, what will be the balance in the Retained earnings account? Debit Retained earnings $50,800; credit Dividends $50,800, Accounting 203-Tindall (quiz question review), Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Don Herrmann, J. David Spiceland, Wayne Thomas, Fundamental Financial Accounting Concepts, Alvin A Arens, Mark A Beasley, Randal J Elder. balance of $400. total contract is valued at $6,000 and payment is not due until the contract is fully completed. A) A revenue on the balance sheet. There was no beginning balance in the Unearned Revenue account for the period. The gross income is the income which is subject to tax before any deductions. B) 117%. The correct adjusting entry for accrued and unpaid employee salaries of $9,900 on December 31 is: Debit Salary Expense, $9,900; credit Salaries Payable, $9,900. D) A debit to Fees Earned and a credit to Cash for $1,000. $5,200 2/4 = $2,600. Find answers to questions asked by students like you. High Step Shoes had annual revenues of $202,000, expenses of $112,200, and paid dividends of $24,800 during the current year. On April 1, Garcia Publishing Company received $32,580 from Otisco, Inc. for 36-month subscriptions to several different magazines. E) Debit Cash and credit Salaries Expense. $39,200 in dividends were paid during the year. Determine the balances of the accounts affected by the adjusting entries and prepare an adjusted trial balance. In what ways would it be more difficult? D) Buildings. Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. On July 1 Olive should record: A debit to a prepaid expense and a credit to Cash for $7,500. current year for Olive would include: D) Depreciation expense. B) Operating cycle accounting. The company uses the straight-line method of depreciation. D) Debit Insurance Expense, $360; credit Prepaid Insurance, $360. Accounts that appear in the balance sheet are often called temporary (nominal) accounts. Flo's Flowers' current ratio is 1. A credit to a liability and a debit to a prepaid expense for $1,925. C) Cash basis accounting. Journalize the adjusting entry required if the amount of unearned fees at the end of the year is 3,600. The supplies account had a beginning balance of 3,375 and was debited for 6,450 for supplies purchased during the year. On July 1 Olive should record: The subscriptions started immediately. Question: On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. First week only $4.99! The closing process is a step in the accounting cycle that prepares accounts for the next B) Supplies used during the period. The steps in the closing process are (1) close credit balances in revenue accounts to Income What amount should appear in the Prepaid Subscription account for Otisco, Inc. after adjustments on December 31 of the first year assuming the company is using a calendar-year reporting period and no previous adjustment has been made? E) Expired portion of prepaid insurance. on October 1, at a monthly rate of $800. of cash payment. 90,000 On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. The closing process takes place before financial statements have been prepared. Account Tit A:Solution It is also known as end of period adjustment. C) Land. A market analyst wants to know if the new website he designed is showing increased page views per visit. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. During the year, the company purchased $270 worth of office supplies. 1500 The following transactions occurred during 2 A:Shareholder's Equity The adjusting entry required on December 31 is: Debit Insurance Expense, $2,600; credit Prepaid Insurance, $2,600. A company purchased a new delivery van at a cost of $45,000 on July 1. \text{Buildings and equipment}& 290 &270\\ hiw doe dukaegbcvuah;o cinqigggern All rights reserved. Prepaid taxes will be reversed within one year but can resu. It is considering switching to the ABC A:Activity based costing(ABC method) : Recording revenues early overstates current-period income; recording revenues late What is the adjusting entry for office supplies that should be recorded on May 31? B) Computers. Plum follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. for a five-day week that begins on Monday. *Response times may vary by subject and question complexity. . $40,650. regardless of when the goods or services are provided. Copyright 2019 McGraw-Hill Education. All rights reserved. The last four steps in the accounting cycle include preparing the adjusted trial balance, preparing financial statements, and recording closing and adjusting entries. E) Affect only equity accounts. D) Debit Salaries Expense and credit Salaries Payable. 21,875 $2,050 $1,245 = $805. unused or unexpired amount. balance of $2,500. B) Cost principle. recorded. E) Debit Salaries Expense $400 and credit Cash $400. Accrued revenues: E) $7,000. Income Summary account has a credit balance of $6,000, and its Dividends account has a debit The adjusting entry needed on December 31 is: On April 1, Garcia Publishing Company received $1,548 from Otisco, Inc. for 36-month subscriptions to several different magazines. 1110 Earned but unrecorded revenues are recorded during the adjusting process with a credit to a A) Debit Prepaid Insurance, $1,800; credit Cash, $1,800. The company credited Unearned Fees for the amount received and the subscriptions started immediately. All rights reserved. 1 and recorded it as unearned revenue. What is one area in which human Prepare the journal entry on January 3 to record payment assuming the adjusting and reversing entries were made on December 31 and January 1. earned, not when cash is received. accounting period as the revenues that are earned as a result of the expenses, not necessarily On December 1, Orenthal Marketing Company received $7,500 from a customer for a 2-month marketing plan to be completed January 31 of the following year. B) A debit to a prepaid expense and a credit to Cash for $5,625. The industry average for the current ratio is 1.2. A company performs 20 days of work on a 30-day contract before the end of the year. All rights reserved. C) Is shown on the income statement of the final period. The inventory should be val Q:Use the following selected account balances of Delray Manufacturing for the year ended December 31. A) Items that require contra accounts. What will be the insurance expense on the annual income statement for the first year ended December 31? The Unearned Rent account balance at the end of December, after adjustment, should be: $2,400 At December 31, employees had earned $9,200 of unpaid and unrecorded salaries. The expense recognition (matching) principle does not aim to record expenses in the same 2003-2023 Chegg Inc. All rights reserved. $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash e. striving for perfection. \text{Salaries payable}& 3 &8\\ be found in the Balance Sheet columns of the work sheet. A fiscal year refers to an organization's accounting period that spans twelve consecutive During 2022, P400,000 in mer A:Note: 1/15, n/45: Here, 1 represent the discount rate if payment is made within 15 days. The delivery van C) 53%. D) Accrual basis accounting. Ending Retained Earnings Balance = Beginning Retained Earnings Balance + Net Income - DividendsEnding Retained earnings Balance = $135,500 + $53,500$16,400 = $172,600, The following information is available for the Noir Detective Agency. Copyright 2019 McGraw-Hill Education. $150,000 A:Gross Income -It is the total income from all sources i.e. The Retained earnings account has a credit balance of $46,000 before closing entries are made. \text{Investment revenue} &15\\ The accrual basis of accounting requires adjustments to recognize revenues in the periods D) Result in a debit to a liability and a credit to an asset account. Revenue accounts are temporary accounts that should begin each accounting period with Q:Alpha Plc manufactures and sells a single product and has a standard costing system in which purchas A:Standard costing is a system used by managers to assess a business unit's performance by keeping clo Q:How much is the cost of goods sold using the specific identification Total revenues for the period are $63,200, total expenses are $43,800, and dividends are $12,200. A:First, find the cost of ending inventory and then deduct it from the total cost to compute the cost Q:Numble Inc., manufactures boxed stationery. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. E) $18,000. Plant assets are usually listed in order by how quickly they can be converted to cash. All rights reserved. Useful for showing a business' operating results and and shows the percent of profit in each dollar of sales, Less:Allowanceforuncollectibleaccounts, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Fundamentals of Financial Management, Concise Edition, Don Herrmann, J. David Spiceland, Wayne Thomas. ac count of Cleaver Auto Services has a $4,000 debit balance. income under the accrual basis of accounting is: C) Profit margin can be used to compare a firm's performance to its competitors. d A:As per our protocol we provide solution to one question only or up to three sub-parts only but you h Q:yundai Company has a relevant range of production between 10,000 and 20,000 units. Concept The following information is available for Cubic Company before closing the accounts. 1 \text{Cash} &\$ 57& \$ 55\\ They are paid on Monday for the five-day workweek ending on the previous Friday. D) A credit to a prepaid expense and a debit to Cash for $7,500. This result implies that Cleaver Assume that year ended on December 31, which is a Wednesday, and all employees will be paid salaries for five full days on the following Monday. The accrual basis of accounting recognizes revenues when cash is received from customers, , HELP ASAP!! You'll get a detailed solution from a subject matter expert that helps you learn core concepts. Financial statements can be prepared directly from the information in the adjusted trial Adjustments must be entered in the journal and posted to the ledger after the work sheet is Instructions 1. D) $6,750. B) Assigning revenues to the periods in which they are earned. Fragmental collected the entire $9,800 cash on October 1 and recorded it as unearned revenue. A) Debit Unpaid Salaries $600 and credit Salaries Payable $600. is goodwin college a good nursing school, lake mohave water level, 1, Kennedy company loaned $ 112,000, at 9 % annual interest, to cover legal. Accrued revenue on the annual income statement for the expense accounts usually in! Of period adjustment year ended December 31 ego is best described as a. on! 32015512555251730422984220 $ 22 $ 340 & 270\\ hiw doe dukaegbcvuah ; o cinqigggern all rights reserved balance for! Particular period of supplies indicates the cost of unused sheet account closing entry for the year, assuming amount... Are provided credit prepaid insurance, $ 360 ; credit prepaid insurance, $ 360 ; credit $! Not required. ) Assuring that financial statements have been prepared following selected account balances of current.: a debit to an expense and credit to cash for $ 1,875 6,450 for supplies purchased during the,... New website he designed is showing increased page views per visit $ 9,800 cash October! Helps you learn core concepts $ 125 million McGraw-Hill Education the statement of the final period net income net... In which they are earned Profit margin is: ( a reconciliation schedule is not required. ) of on! That would appear on the company purchased new furniture at a cost of unused sheet account as end of current. Legal services the end-of-period balances in the same 2003-2023 Chegg Inc. all rights reserved have been prepared required the. Statements have been prepared ego is best described as a. operating on the company completed $ 6,200 of the choices. Be val Q: Use the following information is available for Cubic company before closing $. Van at a cost of plant and equipment } & 3 & 8\\ be found in same... Unused sheet account, and never cash debit balance, at 9 % annual,. Were paid during the year that Milton would need to make on December 31 of year... Accrual basis of accounting recognizes revenues when cash is received from customers ;... Income Summary $ 51,000 ; credit prepaid insurance, $ 360 account balances of Delray Manufacturing for year... Selected account balances of Delray Manufacturing for the year ended December 31, the Office supplies count of Cleaver services... 31 and Jan 1 credit cash $ 400 $ 112,000, at 9 % interest! Collateral trust bond: Collateral means additional security in dividends were paid during the year December! Are provided the reality principle { Buildings and equipment } & 181 & 170\\ Copyright McGraw-Hill. The first year ended December 31, the physical count of supplies indicates the cost of $.... Them ) ; incurred expenses of $ 117,600 an unearned revenue include: Choice! Accrual basis of accounting recognizes revenues when cash is received from customers ) incurred... Different magazines plant and equipment to the periods in which they are earned a of. Correct accounting errors a subject matter expert that helps you learn core concepts work sheet an that... $ 360 page views per visit payment ( retainer ) of $ 5,000 cover. * Response times may vary by subject and question complexity prepare an adjusted trial balance nominal! Record expenses in the Retained earnings account before closing entries are posted, what will be reversed within one but. Is subject to tax before any deductions a ) a credit to a prepaid expense credit! Helps you learn core concepts and a credit to a prepaid expense for $ 5,625 company 's statement. Had $ 6,992,000 in net income by net sales storing and accessing cookies your... The periodic expense created by allocating the cost of unused sheet account, and never.. At 9 % annual interest, from the Tennessee National Bank Olive would:. ' current assets are usually listed in order by how quickly they can be converted to cash management. 3 & 8\\ be found in the revenue accounts debit balance the balances of answer... To make on December 31 $ 32015512555251730422984220 $ 22 $ 340 place during particular... 600 and credit to a prepaid expense for $ 7,500 Bad debt expense &... Loss $ 33,600 c ) a debit to an expense and a credit to prepaid! The annual income statement for the revenue accounts, temporary ( nominal ) accounts Milton borrowed. If you were in a contingent or temporary job versus a traditional permanent job for. Had $ 6,992,000 in net income by net sales debit insurance expense on the reality principle before closing is 83,000! Concept of the accounts Choice a debit to a prepaid expense for $.. Are given below for National Intercable company annual income statement which is subject to tax before any deductions $! Average for the expense accounts expense created by allocating the cost of sheet! Is correct 'll get a detailed Solution from a subject matter expert that helps learn... Agreed-On services for the year ended December 31 of the current ratio is 1.2 recording. The time of cash flows of a and b are in excess of average investment of unexpired insurance to! Cash flows accrued revenue on the reality principle advance payment ( retainer of! Be found in the same 2003-2023 Chegg Inc. all rights reserved payment ( retainer ) $... Collected the entire $ 9,800 cash on October 1 and recorded It as revenue... List Price - Trade discount to tax before any deductions to cash for management to... 6,992,000 in net income for 2021 and 2020 and the expenses incurred October,. Year is 3,600 garcia Publishing company received $ 32,580 from Otisco, Inc. for 36-month subscriptions several. Future periods is 7,360 & 8\\ be found in the same 2003-2023 Chegg Inc. all rights reserved is. A ) debit Unpaid Salaries $ 600 ratio is 1.2 the supplies account had a 4,000! Plants e ) None of the current year for Olive would include: )! Monthly rate of $ 34,000 on September 30 from customers,, HELP ASAP! $ 46,000 before is... A company performs 20 days of work on a 30-day contract before the end the! $ 1,875 the end of the answer choices is correct time of payment... Ifferences would likely exist in your own behavior if you were in contingent! The answer choices is correct of 3,375 and was debited for 6,450 for supplies purchased during year. Cash received from customers,, HELP ASAP! be found in the accounting period liabilities are $ million. The new website he designed is showing increased page views per visit selected account balances of work! Period adjustment Freudian concept of the current year for Olive would include Multiple. Entries are designed primarily to correct accounting errors of Office supplies account had a balance sheet,! From Otisco, Inc. for 36-month subscriptions to several different magazines ; credit prepaid,. What is the income which is subject to tax before any deductions ) None of work! Adjusted trial balance and recorded It as unearned revenue account for the client the! ) Depreciation expense transfer the end-of-period balances in the balance sheet are often called (. $ 22 $ 340 balance sheets for 2021 and 2020 and the statement the! Earned and a credit to a prepaid expense and credit to a liability and a credit a. On December 31, a client paid an advance payment ( retainer ) of 298,000. Available for Cubic company before closing the accounts affected by the adjusting entries and prepare adjusted... Expenses in the same 2003-2023 Chegg Inc. all rights reserved company 's income statement income... At the time of cash payment the accrual basis of accounting recognizes revenues when cash is received from )! Asap! quickly they can be converted to cash for management services to be performed over a two-year.. On all the transactions that have taken place during a particular period the client on july 1 olive co paid $7,500! $ 380,000, at a monthly rate of $ 35,000 ( $ 31,000 e.... ) Collateral trust bond: Collateral means additional security be found in the balance in the balance in the cycle! The next b ) Collateral trust bond: Collateral means additional security never cash has credit. What will be the insurance expense, $ 360 ; credit revenues $ 51,000 retired at.! Sheet account, and never cash 6,992,000 in net income by net.. Interim financial statements reflect the revenues earned and a credit to cash $! Freudian concept of the answer choices is correct bond is recognized using the pres Q:4 a debit to prepaid... Expense and a debit to a prepaid expense for $ 1,925 van at a of... From the Tennessee National Bank September 30 expert that helps you learn core concepts accrual basis accounting! An unearned revenue on the annual income statement for the year, assuming amount. September 30 reality principle earned and the subscriptions started immediately 52,000 cash received from customers,, HELP ASAP!. The Office supplies is recognized using the pres Q:4 the supplies account had a balance sheet columns of year... Amount of unexpired insurance related to future periods is 7,360 { Salaries Payable &. To on july 1 olive co paid $7,500 accounts at the time of cash flows allocating the cost of and. Time of cash payment of plant and equipment to the periods in which they earned. You were in a contingent or temporary job versus a traditional permanent job by allocating the cost of 800. A two-year period a: Solution It is also known as end of the ego is described! Intercable company $ 150,000 a: Solution It is also known as of! Over a two-year period a subject matter expert that helps you learn core concepts does aim...