Jenna Newbury began a music businessin July 2018. Newbury prepares monthly financial statements and uses the accrual basis ofaccounting. The following transactions are Newbury Company’s only activities during Julythrough October:14 Bought music on account for $65, with payment to the supplierdue in 90 days.3 Performed a job on account for Alanna Turner for $55, collectiblefrom her in 30 days. Used up all the music purchased on July 14.16 Collected the $55 receivable from Turner.JulAugSepOct 22 Paid the $65 owed to the supplier from the July 14 transaction.Jenna Newbury began a music businessin July 2018. Newbury prepares monthly financial statements and uses the accrual basis ofaccounting. The following transactions are Newbury Company’s only activities during Julythrough October:14 Bought music on account for $65, with payment to the supplierdue in 90 days.3 Performed a job on account for Alanna Turner for $55, collectiblefrom her in 30 days. Used up all the music purchased on July 14.16 Collected the $55 receivable from Turner.JulAugSepOct 22 Paid the $65 owed to the supplier from the July 14 transaction.Q3-43. If Newbury Company uses the cash basis of accounting instead of the accrual basis, inwhat month will Newbury report revenue and in what month will it report expense?Revenue Expensea. August Octoberb. September Julyc. August Augustd. September October
Jenna Newbury began a music business
in July 2018. Newbury prepares monthly financial statements and uses the accrual basis of
accounting. The following transactions are Newbury Company’s only activities during July
through October:
14 Bought music on account for $65, with payment to the supplier
due in 90 days.
3 Performed a job on account for Alanna Turner for $55, collectible
from her in 30 days. Used up all the music purchased on July 14.
16 Collected the $55 receivable from Turner.
Jul
Aug
Sep
Oct 22 Paid the $65 owed to the supplier from the July 14 transaction.
Jenna Newbury began a music business
in July 2018. Newbury prepares monthly financial statements and uses the accrual basis of
accounting. The following transactions are Newbury Company’s only activities during July
through October:
14 Bought music on account for $65, with payment to the supplier
due in 90 days.
3 Performed a job on account for Alanna Turner for $55, collectible
from her in 30 days. Used up all the music purchased on July 14.
16 Collected the $55 receivable from Turner.
Jul
Aug
Sep
Oct 22 Paid the $65 owed to the supplier from the July 14 transaction.
Q3-43. If Newbury Company uses the cash basis of accounting instead of the accrual basis, in
what month will Newbury report revenue and in what month will it report expense?
Revenue Expense
a. August October
b. September July
c. August August
d. September October
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