Advance Payments for Goods The Chicago Daily Times Corporation (CDT) publishes a daily newspaper. A 52-week subscription sells for $208. Assume that CDT sells 100 subscriptions on January 1. None of the subscriptions are cancelled as of March 31. a. What is the financial statement effect of the receipt of the subscriptions on January 1? b. What is the financial statement effect of one week of earned revenue on March 25? Balance Sheet Income Statement Transaction Assets Liabilities Equity Revenues Expenses = Net Income a. Receipt of subscriptions b. Revenue earned - week ending 3/25 O
Advance Payments for Goods The Chicago Daily Times Corporation (CDT) publishes a daily newspaper. A 52-week subscription sells for $208. Assume that CDT sells 100 subscriptions on January 1. None of the subscriptions are cancelled as of March 31. a. What is the financial statement effect of the receipt of the subscriptions on January 1? b. What is the financial statement effect of one week of earned revenue on March 25? Balance Sheet Income Statement Transaction Assets Liabilities Equity Revenues Expenses = Net Income a. Receipt of subscriptions b. Revenue earned - week ending 3/25 O
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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![**Advance Payments for Goods**
The Chicago Daily Times Corporation (CDT) publishes a daily newspaper. A 52-week subscription sells for $208. Assume that CDT sells 100 subscriptions on January 1. None of the subscriptions are cancelled as of March 31.
a. What is the financial statement effect of the receipt of the subscriptions on January 1?
b. What is the financial statement effect of one week of earned revenue on March 25?
| Transaction | Balance Sheet | Income Statement |
|--------------------------------------|-----------------------------|---------------------------|
| | Assets = Liabilities + Equity | Revenues - Expenses = Net Income |
| a. Receipt of subscriptions | 0 = 0 + 0 | 0 - 0 = 0 |
| b. Revenue earned - week ending 3/25 | 0 = 0 + 0 | 0 - 0 = 0 |
[Check]](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F11ff9f03-4cfd-4604-9eab-3af23331f424%2F6afb9806-7ee6-4b80-8781-521162016cd5%2Fy6vkybd_processed.png&w=3840&q=75)
Transcribed Image Text:**Advance Payments for Goods**
The Chicago Daily Times Corporation (CDT) publishes a daily newspaper. A 52-week subscription sells for $208. Assume that CDT sells 100 subscriptions on January 1. None of the subscriptions are cancelled as of March 31.
a. What is the financial statement effect of the receipt of the subscriptions on January 1?
b. What is the financial statement effect of one week of earned revenue on March 25?
| Transaction | Balance Sheet | Income Statement |
|--------------------------------------|-----------------------------|---------------------------|
| | Assets = Liabilities + Equity | Revenues - Expenses = Net Income |
| a. Receipt of subscriptions | 0 = 0 + 0 | 0 - 0 = 0 |
| b. Revenue earned - week ending 3/25 | 0 = 0 + 0 | 0 - 0 = 0 |
[Check]
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