Answered: Prairies Consultants Inc. Amount of…

Prairies Consultants Inc. Amount of Revenue (Expense) for May 2017 Date Cash Basis Accrual Basis May 1 4 8 11 19 24 26 29 31 31

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: If L'Oso desires a 150% markup on production costs, what is the target cost for the new game? (…

A: Target Cost: A target cost is the maximum amount of cost that can be incurred on a product, however,…

Q: The formula to compute free cash flow is

A: Free cash flow is the available cash from operation which can be used to repay the debt obligation…

Q: Here are selected 2022 transactions of Pina Corporation. Jan. 1 June 30 Dec. 31 Retired a piece of…

A: Journal entry is one of the procedures for listing commercial events in the books of accounts. To…

Q: Define cash and cash equivalents and explain how to report them.

A: Cash and cash equivalents are the current assets of a company which are available as cash or readily…

Q: Statement of Cash Flows (partial) Cash flows from (used for) operating activities: Net income…

A: Lets understand the basics. Cashflow statement is mainly divided into three type of activities which…

Q: Explain the below elements of cash outflows: a- Purchase of New Equipment. b- Investment in…

A: Disclaimer: “Since you have posted a question with multiple sub-parts, we will solve the first three…

Q: Land costing $41,838 was sold for $87,212 cash. The gain on the sale was reported on the income…

A: Cash Flow Statement - Cash Flow Statement includes cash inflow and outflow from the organization.…

Q: Land costing $44,139 was sold for $74,050 cash. The gain on the sale was reported on the income…

A: Cash Flow is a financial statement that shows the extent of cash entering and leaving the…

Q: Salvage value of a piece of equipment would show on the cash flow diagram as wha Select one: a.…

A: Salvage value is the disposal value of equipment at the end of life of project.

Q: Using the indirect technique, depreciation expenses are subtracted from net income before…

A: The indirect (addback) method begins by calculating net income on an accrual basis. Non-cash…

Q: State whether the following items are Capital or Revenue expenditures: 1.Replacement of old…

A: Capital expenditures is non-recurring in nature and it was incurred to increase the operational…

Q: Depending on the length of time, assets will either be categorized as current or long-term. Go to…

A: Current assets are those assets whose expected life is within one year. While as, long-term assets…

Q: increase asset, increase liability, decrease capital....)

A: ASSETS. ASSETS IS ANYTHING THAT CAN BE OWNED OR CONTROL AND GENERATES OR WILL GENERATES AN…

Q: Land costing $42,510 was sold for $70,453 cash. The gain on the sale was reported on the income…

A: Cash flow from sale of land = Land cost + Gain on sale of land

Q: Transaction Asset Liability Capital (g) The owner takes out $100 cash for his personal use.

A: Since basic accounting equation is Total assets = Total liabilities + owners equity

Q: What part of the A=L +SE does expenses and revenues under and are they CR or DR balances? Expenses…

A: The accounting equation shows that sum of all assets= sum of liabilities + sum of owner's…

Q: lease answer Question 3 and Question 6. What would happen to net income and cash flow if…

A: Net income is the cash flow available after doing payments for all kind of expenses and this amount…

Q: Normal expenditures for repairs and maintenance to plant and equipment are accounted for by…

A: Expenses can be of two types; 1) Capital expenditure and 2) Revenue expenditure. When the benefit of…

Q: I am trying to figure out how to do the updated balance sheet but don't know where or how to start?

A: Here's how you can get started on the updated balance sheet: 1. Update the cash balance: Begin by…

Q: If a machine cost $20,000 and the company owes the bank $18,000 on a loan for the purchase of the…

A: Lets understand the basics. As per IAS1, when any asset is purchased by creating any liability then…

Q: A company is deciding whether to purchase a new machine or not, which among the following is not a…

A: A company is deciding whether to purchase a new machine or not is deiced by the Net present value of…

Q: Land costing $41,155 was sold for $77,036 cash. The gain on the sale was reported on the income…

A: The CFS (cash flow statements) of a company usually represent the flow of cash inside out of a…

Q: tion exp

A: In the indirect (addback) method for calculating cash flows, the accrual basis net income is…

Q: The transaction used to record the sale of equipment would include…? --(Accumulated Depreciation)…

A: Equipment is the non-current asset which is kept by the entity to use it for the daily operations of…

Q: If a machine whose original cost is ₹50,000 having accumulated depreciation ₹12,000, were sold for…

A: Cash received (inflow) is $44,000. Cash received from sale of machinery is investing activity.

Q: Land costing $138,463 was sold for $175,514 cash. The gain on the sale was reported on the income…

A: Cash flow includes only the cash amount that is received or paid in the cash transaction.

Q: What is the correct account on the Statement of Cash Flows worksheet to balance a credit in the…

A: The Accumulated Depreciation account is a contra asset account on the balance sheet. It represents…

Q: Explain why the value of the leased asset is not recorded at $5,176 ($1,294 x 4). The leased asset…

A: Leased assets refers to those assets which are leased through the owner to another party in return…

Q: Land costing $41,526 was sold for $79,878 cash. The gain on the sale was reported on the income…

A: Explanation that the land sold for an amount of $ 79,878 that should be reported as the investing…

Q: Suppose your company sells services of $310 in exchange for $200 cash and $110 on account.…

A: Cash flow from operating activities includes all the cash receipts and cash payments which are…

Q: Which of the following cash activities would be listed in the Investing Activities section of the…

A: The cash flow statement shows cash inflow & outflow of cash during the year. It has three…

Q: A machine with a cost of $175,000 and accumulated depreciation of $94,000 is sold for $87,000 cash.…

A: Cash flow from investing activities: It is a section of the cash flow statement that shows the cash…

Q: Net working capital increases when: A. a credit customer pays for his or her purchase B. inventory…

A: Net working capital is the difference between the current asset and current liabilities

Q: Account mber Name 1110 Cash 1120 Accounts Receivable 1130 Prepaid Insurance 1140 Prepaid Rent 1150…

A: Balance sheet is a financial statement of a firm which shows actual position of the firm it includes…

Q: Complete the problem below using these accounts as needed: Cash Accumulated Depreciation Party…

A: Journal entry is made to record the financial transactions of the firm. It is the initial step of…

Q: Need help please

A: Step 1: Since an asset is sold, this amounts to increase in cash flow. All decrease or increase in…

Q: Which of the following is considered a quick asset? Automobiles. Inventory. Prepaid…

A: Following are not included the definition of quick assets: Inventory Prepaid expeneses Automobiles

Q: Patterson Company’s Depreciation Expense is $20,400 and the beginning and ending Accumulated…

A: Depreciation is reduction in the value of assets due to its use, wear or tear.Accumulated…

Question

Show how each transaction would be handled using the cash basis and the accrual basis. Assume depreciation expense of $30 for software and $30 for the computer.

Under each column, give the amount of revenue or expense for May using the cash basis and the accrual basis. (Enter "0" for any transactions that do not affect revenues or expenses. Use parentheses or a minus sign when entering
expenses or losses.)
Prairies Consultants Inc.
Amount of Revenue (Expense) for May 2017
Date
Cash Basis
Accrual Basis
May
1
4
8
11
19
24
26
29
31
31

May 1 Prepaid insurance for May through September, $1,000
4 Purchased software for cash, $700
5 Performed service and received cash, $500
8 Paid advertising expense, $500
11 Performed service on account, $3,200
19 Purchased computer on account, $2,300
24 Collected for the May 11 service
26 Paid account payable from May 19
29 Paid salary expense, $800
31 Adjusted for May insurance expense (see May 1)
31 Earned revenue of $600 that was collected in advance in April

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Cash basis and accrual basis

VIEW

Answer & Explanation:

VIEW

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Current assets include all of the following: cash, inventory, equipment, supplies, and accounts receivable. true or false?
Land costing $40,631 was sold for $79,720 cash. The gain on the sale was reported on the income statement as other income. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?
Give typing answer with explanation and conclusion
What section of the cash flow statement would you find a purchase of manufacturing equipment? a. Profit Before Interest and Tax b. Operating c. Financing d. Investing
please include the money used in each transactions
Put the correct word next to the answer that best describes the following : scheduling, cash, coding, accrual, FIFO, accounts payable, LIFO, point of service, book value, perpetual Often called trade credit. It assumes that payment is made when due. Answer 1 It is assumed that the last units acquired are the first ones used. Answer 2 An asset original cost less the amount of accumulated depreciation. Answer 3 This is the beginning of the revenue cycle Answer 4 The type of accounting used by health care facilities Answer 5 When the patient shows up for care. Answer 6 The organization always knows how much inventory it has on hand Answer 7 The translation of services provided into billable charges. Answer 8 It is assumed that the units required earlier are used before units acquires later Answer 9 The major source of financing for an organization Answer 10
Please see below. I really need help with this asap. Please include relevant terms and dates as needed.
How did you get the Cash realized on asset which is 128,000
26.Land costing $96,832 was sold for $69,017 cash. The loss on the sale was reported on the income statement as other expense. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?