On July 1, 2022, Forest Company started doing business and paid $18,000 in advance for 12 months' rent for a building it uses. What amount of rent expense should be recorded by the company for 2022 under the cash basis of accounting and the accrual-basis of accounting? Multiple Choice Cash-basis = $9,000; Accrual-basis = $9,000 Cash-basis = $9,000; Accrual-basis = $18,000 O Cash-basis = $18,000; Accrual-basis = $9,000 Cash-basis = $18,000; Accrual-basis = $18,000

On July 1, 2022, Forest Company started doing business and paid $18,000 in advance for 12 months' rent for a building it uses. What amount of rent expense should be recorded by the company for 2022 under the cash basis of accounting and the accrual-basis of accounting? Multiple Choice Cash-basis = $9,000; Accrual-basis = $9,000 Cash-basis = $9,000; Accrual-basis = $18,000 O Cash-basis = $18,000; Accrual-basis = $9,000 Cash-basis = $18,000; Accrual-basis = $18,000

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 8RE: At the end of 2019, Framber Company received 8,000 as a prepayment for renting a building to a...

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At the end of 2019, Framber Company received 8,000 as a prepayment for renting a building to a tenant during 2020. The company erroneously recorded the transaction by debiting Cash and crediting Rent Revenue in 2019 instead of 2020. Upon discovery of this error in 2020, what correcting journal entry will Framber make? Ignore income taxes.
The following selected accounts and their current balances appear in the ledger of Clairemont Co. for the fiscal year ended May 31, 2019: Instructions 1. Prepare a multiple-step income statement. 2. Prepare a statement of owners equity. 3. Prepare a balance sheet, assuming that the current portion of the note payable is 50,000. 4. Briefly explain how multiple-step and single-step income statements differ.
YinYang Company reported cash basis of income other than sales of P 50,000 for rent and P18,000 for interest for 2021. The entity would have to convert records and statements to accrual basis again for 2021. It was ascertained in the accrual basis statements made for December 31,2020 that unearned rent amounted to P 20,000 and accrued interest amounted to P 8,000. Upon further checking of records, it was determined that the unearned rent at the end of 2021 amounts to P 15,000 and accrued interest at the end of 2021 amounts to P 6,000. Compute for the accrual basis of income other than sales related to rent and interest for 2021 that will be presented in the December 31, 2021 Statement of Comprehensive Income.
YinYang Company reported cash basis of income other than sales of P 50,000 for rent and P18,000 for interest for 2021. The entity would have to convert records and statements to accrual basis again for 2021. It was ascertained in the accrual basis statements made for December 31,2020 that unearned rent amounted to P 20,000 and accrued interest amounted to P 8,000. Upon further checking of records, it was determined that the unearned rent at the end of 2021 amounts to P 15,000 and accrued interest at the end of 2021 amounts to P 6,000. Compute for the accrual basis of income other than sales related to rent and interest for 2021 that will be presented in the December 31, 2021 Statement of Comprehensive Income.
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For the year ended December 31, 2023, Tamarisk Ltd. reported income before income taxes of $98,000. In 2023, Tamarisk Ltd. paid $45,000 for rent; of this amount, $15,000 was expensed in 2023. The remaining $30,000 was treated as a prepaid expense for accounting purposes and would be expensed equally over the 2024-2025 period. The full $45,000 was deductible for tax purposes in 2023. The company paid $68,000 in 2023 for membership in a local golf club (which was not deductible for tax purposes). In 2023 Tamarisk Ltd. began offering a 1-year warranty on all merchandise sold. Warranty expenses for 2023 were $42,000, of which $35,000 was actual repairs for 2023 and the remaining $7,000 was estimated repairs to be completed in 2024. Meal and entertainment expenses totalled $20,000 in 2023, only half of which were deductible for income tax purposes. Depreciation expense for 2023 was $200,000. Capital Cost Allowance (CCA) claimed for the year was $223,000. Tamarisk was subject to a 20%…
The following accounts and account balances are available for Badger Auto Parts at December31, 2019:Accounts Payable $ 8,500Accounts Receivable 40,800Accumulated Depreciation (Furniture) 47,300Advertising Expense 29,200Cash 3,200Common Stock 100,000Cost of Goods Sold 184,300Depreciation Expense (Furniture) 10,400Furniture 128,000Income Taxes Expense 3,800Income Taxes Payable $ 3,600Interest Expense 6,650Interest Payable 1,800Inventory 60,500Notes Payable (Long-term) 50,000Prepaid Rent 15,250Retained Earnings, 12/31/2018 15,900Sales Revenue 264,700Utilities Expense 9,700Required:Prepare a trial balance. Assume that all accounts have normal balances.
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Leni Company had the following transactions during the quarter ended March 31, 2021:• Loss on Sale- 900,000• Payment of fire insurance premium for calendar year 2021- 400,000• Payment of rent for 1 year- 1,200,000• Payment of property tax assessed for calendar year 2021- 500,000What total amount should be included in the determination of the net income or loss for the quarter ended March 31, 2021?
ZETA Company reported revenue of P6,000,000 under the cash basis for the year ended 2020. Additional information was made available; Accounts receivable, December 31, 2019 P1,250,000; Accounts receivable, December 31, 2020, P1,375,000. Under the accrual basis, how much should ZETA Company report as revenue for 2020?