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3 years ago

(Assumptions, Principles, and Constraint) Presented below are the assumptions, principles, and

1 answer:

5 0

The accounting principles, assumptions, and constraints describes are identified as follows: A) 7, B) 6, C) 8, D) 9, E) 1, F) 4, G) 3.

<h3>What are Accounting Principles?</h3>

These are rules or laws that govern the reporting and recording of the financial information of a business.

7 - Expense Recognition Principle: This holds the rule of thought that expenses made ought to be recorded in the books or recognized in the same time frame as the revenue transactions they are related to.

3 - Monetary Unit Principle: This law indicates that if a transaction cannot be expressed in a currency, then it shouldn't be recorded. This means "in-kind" transactions and favors hold no place in proper Financial Bookkeeping practice.

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On July 1, Crowe Co. pays $15,000 to Zubin Insurance Co. for a 3-year insurance policy. Both companies have fiscal years ending

Neko [114]

Answer:

July 1, Year 1

Prepaid Insurance $15000 Dr

Cash $15000 Cr

Dec 31, Year 1

Insurance expense $2500 Dr

Prepaid Insurance $2500 Cr

July 1, Year 1

Cash $15000 Dr

Unearned Service revenue $15000 Cr

Dec 31, Year 1

Unearned service revenue $2500 Dr

Service revenue $2500 Cr

Explanation:

The company will record the cash going out of the business for prepaid insurance as credit and the asset account prepaid insurance as debit to record the prepayment of insurance for 3 years at the amount of $15000.

The insurance paid out is for 3 years. So, the per year insurance expense is,

Insurance expense per year = $15000 / 3 = $5000

The adjusting entry made on 31 december will record the insurance months consumed (6 months) as an expense and debit the insurance expense and credit the prepaid insurance asset account.

The insurance expense for 6 months = 5000 * 6/12 = $2500

For the receiving company, the cash is being received and as the service will be provided later on, the cash received will be debited and the unearned service revenue will be credited.

As six months worth of cover has passed, on 31 December, the company will record service revenue for 6 months that is $2500 and debit the liability recorded under unearned service revenue.

4 0

3 years ago

Sometimes word of mouth and expert recommendations cause a product to become more popular. However, the firm that produces this

3241004551 [841]

Answer:

Invariably, the cost of the product will rise. A relatively increase in supply parts directly influences the price of a product.

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4 years ago

Insurance is managed by employers, so if an employee is sick and loses her job, her insurance will be expensive due to preexisti

Aleksandr-060686 [28]

This is an example of Selection bias.

<h3>What is Insurance?</h3>

Insurance exists as a way to manage your risk. When you buy insurance, you purchase security against unexpected financial losses. The insurance company reimburses you or someone you determine if something bad happens to you. If you have no insurance and an accident occurs, you may be accountable for all corresponding costs.

Insurance plans exist beneficial to anyone examining to protect their family, assets/property, and themselves from financial risk/losses: Insurance plans will permit you to expend for medical emergencies, hospitalization, contraction of any illnesses and treatment, and medical care needed in the future.

Selection bias happens if those who enroll in HMOs are either more or less likely to utilize health services after changing for factors utilized to set rates (e.g., Medicare sets HMO rates based on age, sex, Medicaid eligibility, and institutional status).

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5 0

1 year ago

The entry to record a purchase of $5,000 on account, terms of 2/10, n/30, would include a

Nezavi [6.7K]

Calculate, from the following information accumulated by Bob Verna, the adjusted cash balance at the end of July.

Bank statement ending cash balance $6,000

General ledger cash balance ending 8,500

Bank monthly service charge 90

Deposits in transit 5,000

Outstanding cheques 3,000

NSF cheque returned with bank statement 410

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3 years ago

Read 2 more answers

Why do you think average income is an important criterion for development explain.

oee [108]

Average income is important because it tells us the income of an average person and gives an idea about the rising standard of living of people.

Average income is basically income earned per person in a given area in a specific year. More income means more money to fulfill your needs and wants. It is believed that the prosperity of a country depends on it. Money is considered an important factor in the development of a country. If the average income of a country increases there are chances of an increase in the development of that country. If the average income is lower there are fewer chances of development.

A country with high average income is considered rich and low average income country is considered poor. The World Bank also uses the average income to measure the development of any country. Therefore average income is considered a very important criteria for development.

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7 0

1 year ago