The highway department contracted with a private company to collect tolls and maintain facilities on a turnpike. Users of the turnpike can pay cash as they approach the toll booth, or they can purchase a pass. The pass is equipped with an electronic sen pass balance as the motorist slowly approaches a special toll booth. The passes are issued in $10 increments. Refunds are available to motorists who do not use the pass balance, but they are issued very infrequently. Last year, $6,130,000 was collected of passes were issued, and $3,490,000 of passes were used at the special toll booth. Which of the following statements shows the correct amount of revenue the company should recognize and reason why this is correct? Oa. Total revenue recognized would be S4,110,000 based on the passes issued during the year. Ob. Total revenue recognized would be $9,620,000 based on the total amount carned during the year for cars that used the tolls. Oc, Total revenue recognized would be S6,130,000 based on the cash that was collected at the toll booths. Od. Total revenue recognized would be S10,240,000 based on the cash collected at the toll booths in addition to the passes issued.

The highway department contracted with a private company to collect tolls and maintain facilities on a turnpike. Users of the turnpike can pay cash as they approach the toll booth, or they can purchase a pass. The pass is equipped with an electronic sen pass balance as the motorist slowly approaches a special toll booth. The passes are issued in $10 increments. Refunds are available to motorists who do not use the pass balance, but they are issued very infrequently. Last year, $6,130,000 was collected of passes were issued, and $3,490,000 of passes were used at the special toll booth. Which of the following statements shows the correct amount of revenue the company should recognize and reason why this is correct? Oa. Total revenue recognized would be S4,110,000 based on the passes issued during the year. Ob. Total revenue recognized would be $9,620,000 based on the total amount carned during the year for cars that used the tolls. Oc, Total revenue recognized would be S6,130,000 based on the cash that was collected at the toll booths. Od. Total revenue recognized would be S10,240,000 based on the cash collected at the toll booths in addition to the passes issued.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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