For each transaction below, calculate the amount of revenue to be recognized in the current period using accrual-basis accounting:(a) Performed $24,000 of services during the month and received full cash payment from customers at the time of service.(b) Performed $9,000 of services during the month and billed customers. Customers are expected to pay next month.(c) Received $12,000 cash from customers for services to be provided next month.
What will be an ideal response?
(a) $24,000; (b) $9,000; (c) $0.
Transaction (c) represents a liability, since revenue has not yet been recognized.
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