! The revenue recognition principle requires that revenue be reported when revenue is earned (when goods are sold or services are provided) and not at the time when payment is received. 15. Accrual accounting is based on...
! The revenue recognition principle requires that revenue be reported when revenue is earned (when goods are sold or services are provided) and not at the time when payment is received. 15. Accrual accounting is based on...
This is the number of a corporation’s capital stock that were actually sold, exchanged for services, etc. and have not been retired. issued shares This is the number of a corporation’s capital stock that were...
Our Explanation of Accounting Basics uses a simple story to introduce important accounting concepts and terminology. It illustrates how transactions will be included in a company's financial statements.
and/or services have been provided to customers (as opposed to when cash is received). revenues Under the accrual method of accounting, these are reported on the income statement when goods and/or services...
Our Explanation of Working Capital and Liquidity provides you with an in-depth look at the components of working capital and the challenges of converting current assets to cash before obligations come due. You will see...
or when they have been used up. Mark as wrong Mark as right operating revenues These revenues refer to amounts earned by a company from its main products or services. operating revenues These revenues refer to amounts...
be reported as revenues on the income statement.) The liability account communicates that a company has an obligation to provide its customers with goods or services or return the money to the customers. Equity Wrong....
Our Explanation of Financial Statements provides you with the highlights of each of the five external financial statements issued by U.S. corporations. Our insights will give you a good understanding of what the...
Our Explanation of Financial Statements provides you with the highlights of each of the five external financial statements issued by U.S. corporations. Our insights will give you a good understanding of what the...
. For example, a company often sells many different products (and/or services) with a wide range of contribution margins (and a variety of contribution margin ratios). Therefore, the same total number of units sold...
Our Explanation of Activity Based Costing illustrates how manufacturing overhead costs for a product will differ when costs are allocated using only the number of machine hours, as opposed to being allocated using the...
Our Explanation of Financial Statements provides you with the highlights of each of the five external financial statements issued by U.S. corporations. Our insights will give you a good understanding of what the...
Since our Explanation of Cash Flow Statement illustrates how the amounts are determined, you will get a better understanding of this very important financial statement. No longer will you look at only the income...
Our Explanation of Manufacturing Overhead gives you examples of what is included in manufacturing overhead. You will learn that these are indirect product costs and therefore are allocated to the products in order to...
or cost Facility-level activity or cost Organization-level activity or cost 19. Security services for the factory. Select... Unit-level activity or cost Batch-level activity or cost Product-level activity or cost...
such as the sale of goods and fees earned from providing services Nonoperating revenues (or other income), earned peripheral activities. An example is interest income that is earned by a retailer when it invests its...
Our Explanation of Accounts Receivable and Bad Debts Expense helps you understand the accounting for the losses associated with selling goods and providing services on credit. You will understand the impact on the...
... Another asset will decrease Current liabilities will increase Stockholders' equity will increase View Coaching Since the store has not earned any revenues from providing goods or services, the amount received...
Our Explanation of Adjusting Entries gives you a process and an understanding of how to make the adjusting entries in order to have an accurate balance sheet and income statement. Eight examples including T-accounts for...
$4,900 for services provided during a calendar year. The contractor is neither a corporation nor an employee of JJCO. Within a month after the year ends, JJCO must provide the contractor with which of the following IRS...
through 6: A company using the accrual method of accounting performed services on account in August. The services were for $2,000 and the company gave the customer credit terms that state the amount is to be paid to the...
Our Explanation of Financial Ratios includes calculations and descriptions of 15 financial ratios. As you calculate the financial ratios you will also gain a deeper understanding of a company's operations and financial...
Our Explanation of Bank Reconciliation will show you the needed adjustments to the balance on the bank statement and also the adjustments needed to the balance in the related general ledger account. A comprehensive...
! Owner's (Stockholders') Equity is not involved in this transaction. Information for Items 10 through 13 Company X provides consulting services to Client Q in May. Company X bills Client Q in May for the...
Our Explanation of Accounting Basics uses a simple story to introduce important accounting concepts and terminology. It illustrates how transactions will be included in a company's financial statements.
Our Explanation of Working Capital and Liquidity provides you with an in-depth look at the components of working capital and the challenges of converting current assets to cash before obligations come due. You will see...
more, see Explanation of Inventory and Cost of Goods Sold. A current asset resulting from selling goods or services on credit (on account). Invoice terms such as (a) net 30 days or (b) 2/10, n/30 signify that...
. Which of the following uses amounts from more than one financial statement? Current Ratio Wrong. Inventory Turnover Ratio Right! Quick Ratio Wrong. Working Capital Wrong. 21. A company received a $5,000 invoice for...
products, but it is not useful for companies that provide services. True Wrong. Break-even analysis is useful for service companies as well as companies that sell products. False Right! Use this information to answer...
Since our Explanation of Cash Flow Statement illustrates how the amounts are determined, you will get a better understanding of this very important financial statement. No longer will you look at only the income...
Our Explanation of Financial Accounting introduces some of the basic accounting concepts and how they affect the income statement, balance sheet, and other financial statements.
Our Explanation of Accounting Basics uses a simple story to introduce important accounting concepts and terminology. It illustrates how transactions will be included in a company's financial statements.
Our Explanation of Bank Reconciliation will show you the needed adjustments to the balance on the bank statement and also the adjustments needed to the balance in the related general ledger account. A comprehensive...
accounts payable This current liability account reports the amounts owed to vendors (suppliers) for goods and/or services that were received on credit. accounts payable This current liability account reports the...
Accounts payable is a current liability that reports the amount a company owes to its vendors or suppliers. If the amount of accounts payable has increased, it means that the company did not pay for all of the goods and...
result from selling goods (or providing services) and allowing the customers to pay at a later date (perhaps in 10, 30, or 60 days). At the time of the sale, the seller transfers ownership of the goods to the customer...
for $20,000 (which reduces Revenues) and credit a liability account such as Deferred Service Revenues or Unearned Service Revenues for $20,000. 17. On December 10, a website design company received $15,000 as an advance...
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