Cash and Sales would not be found on the same financial statement. True, because Cash is an asset and Sales is revenue and therefore reported on the Balance Sheet and Income Statement, respectively. False, because when added together the user can determine Owner's Equity. True, because there is no need to report the same thing twice. False, because Cash and Sales are both revenues and therefore both would be reported on the Income Statement.

Cash and Sales would not be found on the same financial statement. True, because Cash is an asset and Sales is revenue and therefore reported on the Balance Sheet and Income Statement, respectively. False, because when added together the user can determine Owner's Equity. True, because there is no need to report the same thing twice. False, because Cash and Sales are both revenues and therefore both would be reported on the Income Statement.

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter11: Auditing Inventory, Goods And Services, And Accounts Payable: The Acquisition And Payment Cycle

Section: Chapter Questions

Problem 7CYBK

See similar textbooks

Similar questions

Which of the following is false? A. A liability is created when cash is received prior to delivery of the goods or services. 20. B. Revenue is recognized at the time of delivery of the goods or services if cash is received. C. Revenue is not recognized at the time of delivery of goods and services if cash is received after delivery of the goods and services. D. Collecting cash after delivery of a good or service does not create revenue on the income statement at the date of collection.
Identify the statement below that is correct: Multiple Choice Debits decrease asset and expense accounts, and increase liability, equity, and revenue accounts. The left side of a T-account is the credit side. Credits increase asset and expense accounts, and decrease liability, equity, and revenue accounts. The total amount debited need not equal the total amount credited for a particular transaction. The left side of a T-account is the debit side.
Which one of the following statements about revenue is not correct?A. Revenue can result in increases in accounts receivableB. Revenue can result in increases in liabilitiesC. Revenue is earned whenever cash is received from a customerD. Revenue is earned when a service is provided to a customer
An adjusting entry would adjust revenue so it is reported when earned and not when cash is received. true false?
Which of the following assets would not be included as a quick asset? a.Merchandise inventory b.Cash c.Temporary investments d.Accounts receivable
EITHER TRUE OR FALSE. Describe why the assertion is incorrect if it is in fact incorrect. 1. Cash rules are standards by which employees should be guided and safeguarded against the income statement being misused.
What’s the correct answer?
How many of the following statements regarding the Revenue Recognition and Matching Principles are true? According to the Revenue Recognition Principle, a company should not record the revenue from a transaction until it is actually received in cash. If payment is received at the time a service is provided there is no difference between how cash and accrual accounting record the transaction. The Matching Principle requires that expenses be matched to the period in which they help to produce revenue. Group of answer choices A. None B. One C. Two D. Three
A contra account will not be listed immediately after its related account. O be potentially classified as a contra-assets or contra-liabilities. always has a normal debit balance. has a normal balance which is the opposite of its related account.
Interest expense is listed on the Income Statement in 'Other revenue and Expenses'. Assess the truth of this statement. Group of answer choices This statement is true. This statement is false. There is not enough information to determine whether or not this statement is true. This statement is not applicable to accounting concepts.
Graves Construction is journalizing two transactions related to uncollectible accounts. The first transaction does not affect cash flows. but the second transaction does affect cash flows. If Graves Construction uses the allowance method to account for uncollectibles, which of the following scenarios may pertain to these transactions? O The first transaction is to record the sale of uncollectible accounts to a factor, and the second transaction is to record the write-off of an uncollectible account. O The first transaction is to record the recovery of a previously written off collectible account, and the second transaction is to record the estimate of uncollectible accounts. The first transaction is to record the write-off of an uncollectible account, and the second transaction is to record the recovery of a previously written off uncollectible account. O The first transaction is to record the write-off of an uncollectible account, and the second transaction is to record the estimate…
Which statement is incorrect? Under cash basis of accounting, A. revenue is recorded when earnedB. expenses are recorded when paid.C. depreciation expense is recognized.D. bad debts expense is not recognized.E. none of the above