Calmar Corporation sold merchandise to a customer for $30,000 on credit on July 15. The customer paid Calmar the amount due on July 31. Under accrual accounting, how should Calmar record the transaction? The company will recognize the revenue on July 31. The July 15 transaction increases revenue but has no effect on assets because cash has not been received. The July 31 transaction has no effect on total assets under the accrual basis. Revenue is recognized after the cost of the merchandise sold has been paid by Calmar
Calmar Corporation sold merchandise to a customer for $30,000 on credit on July 15. The customer paid Calmar the amount due on July 31. Under accrual accounting, how should Calmar record the transaction? The company will recognize the revenue on July 31. The July 15 transaction increases revenue but has no effect on assets because cash has not been received. The July 31 transaction has no effect on total assets under the accrual basis. Revenue is recognized after the cost of the merchandise sold has been paid by Calmar
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Calmar Corporation sold merchandise to a customer for $30,000 on credit on July 15. The customer paid Calmar the amount due on July 31. Under accrual accounting, how should Calmar record the transaction?
The company will recognize the revenue on July 31.
The July 15 transaction increases revenue but has no effect on assets because cash has not been received.
The July 31 transaction has no effect on total assets under the accrual basis.
Revenue is recognized after the cost of the merchandise sold has been paid by Calmar.
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