income b. unearned income c. accrued income d. accrued expense

Q: Gon Incorporated reported its inventory balance on December 31, 2016 at P5,000,000. During the…

A: 1) Good purchased and sold in the same year as per periodic system are not recorded.  Hence Gross…

Q: Which should be subtracted from the net income when using the indirect method? A. Loss on sale of…

A: A cash flow statement is a financial statement that summarizes the cash and cash equivalents…

Q: Due to the covid-19 pandemic, TRUE has experienced extreme financial pressure and has been in…

A: Working note: Computation of fair value of note after the changes in terms: Fair value of…

Q: It is added to income received to determine the total income for the year that is recorded under the…

A: Net income: It can be defined as the excess of a company's sales revenue over the expenses incurred…

Q: What is the effect of omission of accrued income in assets at the end of the year of error? a.…

A: Accrued income: Increases assets Increases Owners' equity

Q: When do we use the Income Summary Account? OA. At the beginning of the financial year to close net…

A: The income summary account provides the summary for loss or profits earned by business during…

Q: When a loss contingency is recognized, where is it reported on the income statement?

A: A financial statement that lists the company's earnings and expenses is called an income statement.…

Q: accrued income in retained earnings at the end of year 2? a.Understated b.Cannot be determined from…

A:

Q: Omission of accrued income in year 1 will result to a. Overstatement of assets in year 1

A: Accrued income means an income which is earned but not received.  As per…

Q: Which of the following journals would correctly post an adjustment for deferred (prepaid) income?…

A: The journal entries are prepared to keep the record of day to day transactions of the business on…

Q: What is the effect of omission of accrued income in retained earnings at the end of year 2? a.…

A: A basic Accounting equation is given as under;   Assets = Equity + Liabilities    Meaning,  Total…

Q: An impairment loss for long-lived assets which are to be held and used should be reported on the…

A: an impairment loss for long lived assets which are to be held and used should be reported on the…

Q: Non-recognition of deferral at the end of the accounting period will   a.understate income and…

A: Deferrals means the payment made or received for the expenses or the income which has not been yet…

Q: recorded under the accrual basis of accounting A. deferred income - end B. prepaid expense - beg C.…

A: (c) Accrued income-beg , is added to income received to determine the total income for the yearthat…

Q: Which of the following types of errors will not self-correct in the next year?

A: Answer: There are different types of accounting errors in the financials.

Q: tate the effect of the following errors if OVERSTATED, UNDERSTATED, or NO EFFECT. NO. ERRORS EFFECT…

A: Solution  Concept Retained earnings is understated if net income is understated Retained earnings is…

Q: What is the effect of omission of accrued income in assets at the end of the year of error? O NO…

A: A basic Accounting equation is given as under;   Assets = Equity + Liabilities    Meaning,  Total…

Q: If the adjustment for unearned revenues is not recorded O a. net income will be correctly stated. O…

A: Lets understand the basics. Adjustment entry is need to pass at year end to follow matching…

Q: Reversing entries maybe used in unearned income when the original collection is recorded as a.…

A: Answer When unearned revenues are recorded as liabilities then an unearned revenue account is…

Q: Communication (income statement): The balance of Interest Expense from accruing interest to be paid…

A: The adjustment entries are prepared to adjust the revenue and expenses for the current period. The…

Q: PROBLEM A Your examination of the financial statements of Water Corporation revealed the following…

A: Net income means the amount of profit earned after deducting all expenses from the revenue of the…

Q: In year 2022, collection of interest income is credited to Interest Expense. What is the effect of…

A: While preparing books of accounts, there can be two kinds of mistakes: Error of omission and error…

Q: How are gain contigencies reported in the financial statements?

A: A gain contingency A  gain contingency  is a possible gain arising from past events but whose…

Q: Alternative Accounting Treatments a. Estimate the amount of liability and record. b. Do not record…

A: Contingent liabilities are those liabilities which might be incurred through entity grounded on the…

Q: The payment of supplier's account is debited to accounts receivable. What is the effect of the error…

A: Ans. The error while passing journal entries leads to overstated or understate of profits.

Q: What is the effect of omission of prepaid expense in net income during the year of error? a.…

A: Prepaid expenses should be deducted from the particular expense to which it relates in the…

Q: In year 2022, collection of interest income is credited to Interest Expense. What is the effect of…

A: Solution Concept When the income is not recorded the effect is understatement of the revenue and it…

Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.