1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Nostrana [21]
3 years ago
7

Consider the following transactions: The company uses supplies purchased in the previous period, $1,500.The company pays cash fo

r rent in advance, $6,000.The company repays a loan to the bank, $10,000 (ignore any interest cost).The amount of accrual-basis expense is _____ while the amount of cash-basis expense is _____.
Business
1 answer:
Step2247 [10]3 years ago
8 0

Answer:

Accrual basis expense is $1,500

Cash basis expense is $6,000

Explanation:

A company that follows accrual basis records expenses when it is incurred irrespective of when it is paid.

The company utilizes supplies in the current period that was purchased in the previous period. So, it will be recorded in the current period as accrual basis expense of $1,500.

Rent paid in advance is a liability for company following accrual basis, so it is not an accrual basis expense. It is a cash basis expense as an expense is recorded when cash is paid under cash basis.

So, cash basis expense is $6,000.

Loan amount repaid is a liability in both cases. So, liability is reduced by $10,000. It is not an expense. Only interest amount is expensed.

You might be interested in
merchandise costing 1200 is sold for 2200 on term 2/30,n/60. If the customer pays within the discount period. Prepare the journa
spin [16.1K]

Answer:

The journal entries are as follows:

(a) Accounts receivables [$2,200 - 2%] A/c Dr. $2,156

             To Sales revenue                                              $2,156

(To record the sale)

(b) Cost of Goods Sold A/c Dr. $1,200

          To inventory                                $1,200

(To record the cost of goods sold)

(c) Cash A/c Dr. $2,156

       To Accounts receivables  $2,156

(To record payment within discount term)

3 0
3 years ago
Many new restaurants have opened in collegetown in recent years. given this change in supply, what type of demand would result f
melamori03 [73]
The answer is Inelastic Demand. Hope this helps!!!
Have a great day!!

6 0
3 years ago
Hadley Corporation issued 200,000 shares of $5 par value common stock for $25 per share. During that year, the corporation susta
kari74 [83]

Answer:

D : common stock of $1,000,000

Explanation:

Hadley Corporation

Issued shares × par value common stock

Issued shares 200,000

Par value common stock $5

Hence:

200,000 x $5

= $1,000,000

Therefore the year-end balance sheet would show a common stock.of $1,000,000

8 0
3 years ago
What is the differents<br> between sole trading and partnership​
ycow [4]
Sole trading is a business conducted by one person. A partnership is a business conducted by two or more people. Brainliest please :)
4 0
3 years ago
Read 2 more answers
If you returned a $5 federal reserve note to the fed, you could receive:
QveST [7]
If you returned a $5 federal reserve note to the fed, you could receive five 1$ bills, t<span>he FED or the Federal Reserve system is the central bank of the United States. Congress created the Federal Reserve through a law enacted in 1913, giving it the responsibility of promoting a solid banking system and a thriving economy.</span>
7 0
3 years ago
Other questions:
  • Sémeuo is a German transnational food and beverage company. Recently, some of the products were rejected by the quality control
    6·1 answer
  • During the 1920s, the Federal Reserve increased the money supply and kept interest rates very low, encouraging consumer spending
    14·1 answer
  • What is APPLE target market?
    11·1 answer
  • Alco roofing company's beginning accounts receivable were $200,000 and ending accounts receivable were $270,000. during the peri
    9·1 answer
  • When direct materials are used in production, costs are assigned by debiting Work-In-Process Inventory and crediting __________.
    7·1 answer
  • There are many positive effects to globalization, but which of the following would be a negative effect?
    10·1 answer
  • Reinforcement, contact, honesty, and fair expectations are
    7·2 answers
  • Joshua is in the new marketing department of a midsized car accessories company. He is working on the first marketing plan the f
    8·1 answer
  • Can an individual's financial situation change his or her views of what is
    13·1 answer
  • Which are factors that both budget constraint diagrams and production possibilities frontier diagrams highlight
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!