What is the effect of overstating the accrued utilities at the end of period?   overstated expense and overstated profit   overstated expense and overstated liability   overstated owner’s equity and understated liability   understated owner’s equity and overstated profit   answer not given

Q: Refer to the following given information. The cost of inventory sold to customer 220,000 Advertising…

A: Ratio analysis: Ratio analysis is a tool that establishes a relationship between the different…

Q: Why Sales revenue does not include the residual value?

A: The residual value, also known as salvage value, is the estimated value of a fixed asset at the end…

Q: Expense Recognition Question: Why is that sometimes there is no direct relationship between…

A: Accounting is based on a set of principles and rules and the expense recognition principle is one of…

Q: n accounting for by-products, when the by-products are sold for more than the estimated sales value,…

A: There are two options available to the entity. The entity can choose either of the following options…

Q: EBITDA removes which of the following from the operating income number? a. Significant variable and…

A: Earnings Before Interest, Taxes, Depreciation, and Amortization is referred to as EBITDA. It is a…

Q: 7 What are utilities, property taxes, and insurance all examples of? A O Contract contingencies. BO…

A: We first needs to understand all the terms given in the question to answer the question. Contract…

Q: Period cost shown in statement of financial position. True or false

A: The period costs are the costs that are incurred in the period they are expensed.

Q: Bonus in reduction of premium given in the adjustments will be recorded in: a. Both credit and debit…

A: Bonus is the share of profit which a policy holder gets from the life insurance company. Premium…

Q: Which of the following is not a correct definition of the breakeven point? A.the point where total…

A: At Breakeven Point, Total Profits are equal to zero, Contribution Margin equal to Total Fixed…

Q: total revenue is incorrect

A: Total Revenue consist of  Revenue from Operation (Sales Revenue) Other Income (Interest Income,…

Q: Fringe benefits are reported as on the income statement. Multiple Choice Assets Expenses Liabilities…

A: Fringe benefits -  These are the benefits offered to employees apart from the salary given to…

Q: crease in revenue is on the credit side hence a decrease in expense is also on credit side   true…

A: Solution: Revenues have credit balance and expenses have debit balances. When Revenue is credited it…

Q: Gross margin is included on the income statement under which format(s)? A) B) C) D) Contribution…

A: Gross Margin is included on the income statement under traditional approach.  Gross Margin = Sales -…

Q: Purchase of equipment on account increases which of the following?

A: First option is wrong because the purchase of equipment on account not only increases asset, but…

Q: Expense and loss are the same. Net loss is a deficit or negative figure in the net income lin

A: No expense and loss are not the same. Yes net loss is shown as a negative figure (in brackets) in…

Q: Outstanding rent is Select one: a. Long term liability O b. A revenue C. A current liability O d. A…

A: Outstanding rent come under the head of Current Liability within the record. Outstanding rent are…

Q: The efforts-expended method of recognizing revenue over time is considered to be an output method.…

A: In this question, we are required to determine whether the given statement regarding revenue…

Q: In the revenue account bonus in reduction of premium is shown as :

A: Throughout all situations involving general insurance, the insurance policy will always be acquired…

Q: Additional information 1. Operating expenses include depreciation expense of R34 000 and…

A: The cash flows from operating activities include the cash received and paid in the course of the…

Q: The balance of the Cost of Goods Sold account: O a. increases when there is a sale. O b. increases…

A: When there is a sale then unit of goods would be sold more and which will increase the cost of…

Q: What is an overbilling and how is it used in percentage - of - completion accounting?

A: In construction and project accounting, overbilling refers to the situation where a contractor…

Q: What is the preferred order of reconciliation? cost, sales, income O income, cost, sales sales,…

A: Income is defines as total costs of the project deducted from total sales from the project.

Q: Which of the following is not an example of a fixed cost   A.Salaries of staff   b. Direct…

A: A fixed cost is a type of cost which does not change with the change in level of activity and will…

Q: According to the historical cost system, what is the objective of accounting and the role of profit?…

A: Historical cost system believes that the asset needs to be recognised on the basis of cost at the…

Q: Why put the normal loss costing into the true loss account for abnormal loss?

A: Cost accounting: Cost accounting is a form of managerial accounting that aims to capture a company's…

Q: What is the impact on profit for the year if income overstated? a. no effect b. profit will be…

A: Lets understand the basics. If there is error in recording the transaction then adjustment needs to…

Q: Which of these is an example of an income item that is typically both operating and persistent? A.…

A: The income statement is a financial document that offers a condensed overview of a company's…

Q: An expense represents a liability a cost of doing business none of the above a withdrawal

A: Liability represents the amount which will be paid by the entity in future as a result of present or…

Q: Profit is earned on sale of asset when a. Sale price is less than Accumulated Depreciation b. Sale…

A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…

Q: Under both accrual basis and modified accrual basis we recognize expenses when it is incurred. a.…

A: Accrual basis of accounting says that expense should be recorded in that period in which they are…

Q: Accounting Current Cost Measurement Why liabilities, such as Accounts Payable (an obligation) is…

A: Answer:- Financial statements provide a snapshot of a corporation's financial health at a particular…

Q: Journey Company sells 120 packs of Pokemon cards for $30 each. Sales tax of 9% is required on all…

A: There are two types of sales in business and those are enumerated as below:  1. Cash sales  2.…

Q: Which of the following is an incorrect statement?     Revenue - Operating Income = Gross Margin…

A: Gross margin is the amount earned by the firm after deducting COGS from revenue.

Q: profit earned if operating capacity at the end of the period is greater than the operating capacity…

A: Formula: Profit = Revenues - expenses Deduction of expenses from revenues derives the profit.

Q: Why is it important to report discontinued operations separately from income from continuing…

A: Discontinued operations referred to the segments of a firm's core business line that have been shut…

Q: An expense represents a liability a cost of doing business none of the above a withdrawal

A: Every person starts a business to make a profit. But before making any profits and income,…

Q: How is accidental loss of goods treated in final account in case: a: Goods had not been insured or…

A: Accidental loss:   It is a loss incurred by a sudden or unexpected incident to the company. Accident…

Q: An income statement should not list unexpected but customary expenses. Select one: a. Non recurring…

A: Answer

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is