What is the difference between the cash basis and the accrual basis?
What will be an ideal response?
When the cash basis is used, a sale is recorded when cash is received from the customer. Expenses are recorded when cash is paid.
When the accrual basis is used, sales are recorded when the good or service is provided regardless of when the cash is collected from the customer. Expenses are recorded when the cost is incurred or expires, even if the expense has not been paid.
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On the statement of cash flows, cash sale of property, plant and equipment used for the last 5 years in the company's operations is treated as a/an
a. investing activity. b. financing activity. c. operating activity. d. exchange transaction. e. funds flow activity.
A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $200 worth of merchandise. On July 28, it paid the full amount due. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, the correct journal entry to record the merchandise return on July 7 is:
A. Debit Accounts Payable $200; credit Merchandise Inventory $200. B. Debit Merchandise Inventory $200; credit Sales Returns $200. C. Debit Merchandise Inventory $200; credit Accounts Payable $200. D. Debit Merchandise Inventory $1,600; credit Cash $1,600. E. Debit Accounts Payable $1,800; credit Purchase Returns $200; credit Merchandise Inventory $1,600.
The Supreme Court in the Teresa Harris v. Forklift Systems, Inc case held that
a. for there to be sexual harassment, the conduct must affect an employee's psychological well-being. b. conduct need not affect an employee's psychological well-being to constitute sexual harassment. c. Title VII does not apply to sexual harassment cases. d. Title VII does not apply to same-sex harassment.
Monopoly power is tested by determining how big the corporation is in terms of total assets
a. True b. False Indicate whether the statement is true or false