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polet [3.4K]
3 years ago
5

The cash basis method of accounting requires revenue to be recognized when performance obligations are satisfied. (If false, ide

ntify error and correct.)
A. True
B. False
Business
1 answer:
xxTIMURxx [149]3 years ago
6 0

Answer:

True

Explanation:

Unlike Accrual basis accounting the cash basis method of accounting requires revenue to be recognized when performance obligations are settled rather than when they are incurred.

The major difference between cash and accrual accounting is in the timing of when transactions are taken account of. Whereas Accrual accounting recognizes transactions when they occur (i.e. expenses when they are incurred and revenue when they are earned) Cash accounting recognizes revenue and expenses only when cash is paid.

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Recording purchases made for cash and on account. LO 8-1 Lewis Corporation engaged in the following transactions during June. DA
vampirchik [111]

Answer:

(A) June 4

Inventory debit 1,065

Accounts Payable credit 1,065

(B) June 15

Inventory debit 1,550

Cash credit 1,550

(C) June 30

Accounts Payable debit 1,065

Cash credit 1,065

Explanation:

(A) there is no information or suggestion that Lweis will take the discount, we post as it was nominal, if later on it is paid within the discount period, we will recognize it. <u>No discount is recorded</u>

(B) Simple: increase the inventory receive and decrease cash by the amount paid.

(C) We settle the account payable for the nominal of the purchase.

It wasn't within the discount period. So <u>no discount is granted.</u>

5 0
3 years ago
The combination of product lines offered by a manufacturer is called the firm's:
aliina [53]

Answer:

product mix

Explanation:

The combination of product lines offered by a manufacturer is called the firm's: product mix.

7 0
1 year ago
Your phone service provider offers a plan that is classified as a mixed cost. The cost per month is $50 flat rate for the first
fomenos

Answer:

$120

Explanation:

The computation of the cost is shown below:

= Cost per month flat for 1,000 units + extra cost if exceeded 1,000 minutes

where,

Cost per month flat for 1,000 units = $50

And, the extra cost is

= $0.35 × 200 minutes

= $70

So, the total cost is

= $50 + $70

= $120

The 200 minutes is come from

= 1,200 minutes - 1,000 minutes

4 0
3 years ago
The cost constraint suggests that, even when the cost of providing accounting information exceeds its benefit, the financial acc
Alekssandra [29.7K]

Answer:

False

Explanation:

The GAAP established that when the benefits of obtaining accounting information are lower than the costs of providing that information, the information should not be provided.

For example, sometimes there are very small differences in certain accounts that don't allow a balance sheet to be balanced. If the accounting error is very small, e.g. just a few hundred dollars, then it is not reasonable to have a whole audit team check all the financial statements again to determine what caused the error. An adjusting entry could be made to close the account balances.

Imagine you are an auditor that must check the physical inventory of a factory and some boxes containing supplies are misplaced. It might take you a whole day to count again all the supplies and materials, but is it worth it? If the supplies were really expensive, probably yes, but if they were cheap components, then probably no.

3 0
3 years ago
When contemplating a product deletion, a firm studies customer migration patterns to determine: the profit contribution of the p
pentagon [3]

Answer: whether customers of the product would switch to other substitute products marketed by the same firm.

Explanation:

Customers regular move from one good to another or from one good to it's substitutes in a process called Customer Migration.

There are various reasons for this such as affordability, change in technology, trends and the like.

When a company contemplates ending a product line and decides to study customer migration patterns, they are checking to see what the customer will switch to when the product is deleted. If they make substitutes to the product to be deleted, they will be checking to see if the customers will switch to these substitutes if the product line is ended.

4 0
3 years ago
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