The condition for which revenues are recognized even when the cash is collected in a different accounting period is;
- Services are provided even if cash has not yet been collected, in cases of accrual basis accounting
<h3>Revenue recognition</h3>
Two major forms of revenue recognition exist;
- When Cash is collected from customers. This is the case when the organisation uses cash basis accounting
- When services are provided even if cash has not yet been collected. This is the case when the organisation used accrual basis accounting
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The justification for a company initially recording prepaid rent in either an income statement or balance sheet account is that a<u>t the end of each year, the</u><u> account balances </u><u>are revised so that they accurately represent the c</u><u>urrent situation.</u>
This is further explained below.
<h3>What is
an income statement?</h3>
Generally, When a business first records its prepaid rent, it should do so in either an account on its income statement or one on its balance sheet.
The reason for this is because, at the end of each year, the balances of these accounts should be revised so that they more accurately reflect the situation at the moment.
In conclusion, An income statement, also known as a profit and loss account, is one of the financial statements that a business maintains.
It details the revenues and costs that the firm incurred during a certain time period. It describes the process through which the revenues are converted into the company's income or profit after taxes.
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<u></u>
Answer: A person who owns and runs a business, which is normally a small business (eg. Shop Owner).
The sole trader has unlimited liability, meaning that his assets will be used in case of default to pay.
The innermost bay of the Yellow Sea is called the Bohai Sea (previously Pechihli Bay or Chihli Bay). Into it flow both the Yellow River (through Shandong province and its capital Jinan) and Hai He (through Beijing and Tianjin). Deposits of sand and silt from those rivers contribute to the sea colour.
The northern extension of the Yellow Sea is called the Korea Bay.
The Yellow Sea is one of four seas named after common colour terms — the others being the Black Sea, the Red Sea and the White Sea.
Answer:
4. how much debt should be assumed to fund a project.
Explanation:
The capital structure is a mix of the debt and equity
In equation form, it is
Capital structure = Debt + equity
These two items should be taken for financing the assets of the company
And, the other options that are mentioned are related to the techniques of the capital budgeting
Therefore, the correct option is 4.
