Question

Aster Inc. purchased inventory worth $6,500. The company pays $3,000 immediately and commits to paying the balance within fifteen days. Which amount will it record for the payment under the accrual-basis accounting method?
A. $6,500
B. $3,000
C. $3,500
D. $9,500

Answer 1

Answer:

$3500

Explanation:

The amount that will be recorded under the accrual-basis accounting will be $3500. accrual - basis accounting is a type of accounting method that is used to record both expenses incurred and income earned by a company.

The accrual-basis accounting tends to match revenue earned and debts incurred by a company hence its advantage is that a company will easily know how profitable they are. in Accrual- basis accounting foreseen/estimated debts like the remaining balance from the $6500 debt which is $3500 is recorded under the accrual-basis account.