If XYZ Consulting performs a consulting service, bills the customer on June 28, and receives payment from the customer on July 19, on what date would revenue be recorded if a. XYZ uses the cash basis of accounting? b. XYZ uses the accrual basis of accounting?

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Answer 1

Textbook Question

Chapter 3, Problem 1DQ

If XYZ Consulting performs a consulting service, bills the customer on June 28, and receives payment from the customer on July 19, on what date would revenue be recorded if

a. XYZ uses the cash basis of accounting?
b. XYZ uses the accrual basis of accounting?

Expert Solution & Answer

To determine

Record the revenue in which date.

Explanation of Solution

Accrual basis of accounting:

Accrual basis of accounting refers to recognizing the financial transactions during the period in which the event occurs, even if the cash is not exchanged.

Cash basis of accounting:

Cash basis of accounting refers to the recognition of financial transactions only when the cash is received or paid.

Record the revenue in which date:

a. On July19 the revenue is recorded by the Company XYZ because cash has been received from the customer.

b. On July28 the revenue is recorded by the Company XYZ because the revenue has been recognized when it is earned.

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Students have asked these similar questions

Please explain the correct approach for solving this general accounting question.

Valmont Electronics Inc. purchases and resells laptops. On October 10th, 2023, the company purchased 4,500 laptops for $350 each. On October 30th, the company sells 1,200 units for $520 each. What is the cost of goods sold on the sale?

Last year Kellner Corporation reported cost of goods sold of $180,000. Inventories decreased by $15,000 during the year, and accounts payable increased by $8,000. The company uses the direct method to determine the net cash flows from operating activities on the statement of cash flows. The cost of goods sold adjusted to a cash basis would be: a. $203,000 b. $157,000 c. $165,000 d. $172,000

Answer 2

Textbook Question

Chapter 3, Problem 1DQ

If XYZ Consulting performs a consulting service, bills the customer on June 28, and receives payment from the customer on July 19, on what date would revenue be recorded if

a. XYZ uses the cash basis of accounting?
b. XYZ uses the accrual basis of accounting?

Expert Solution & Answer

To determine

Record the revenue in which date.

Explanation of Solution

Accrual basis of accounting:

Accrual basis of accounting refers to recognizing the financial transactions during the period in which the event occurs, even if the cash is not exchanged.

Cash basis of accounting:

Cash basis of accounting refers to the recognition of financial transactions only when the cash is received or paid.

Record the revenue in which date:

a. On July19 the revenue is recorded by the Company XYZ because cash has been received from the customer.

b. On July28 the revenue is recorded by the Company XYZ because the revenue has been recognized when it is earned.

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Answer 3

Textbook Question

Chapter 3, Problem 1DQ

If XYZ Consulting performs a consulting service, bills the customer on June 28, and receives payment from the customer on July 19, on what date would revenue be recorded if

a. XYZ uses the cash basis of accounting?
b. XYZ uses the accrual basis of accounting?

Expert Solution & Answer

To determine

Record the revenue in which date.

Explanation of Solution

Accrual basis of accounting:

Accrual basis of accounting refers to recognizing the financial transactions during the period in which the event occurs, even if the cash is not exchanged.

Cash basis of accounting:

Cash basis of accounting refers to the recognition of financial transactions only when the cash is received or paid.

Record the revenue in which date:

a. On July19 the revenue is recorded by the Company XYZ because cash has been received from the customer.

b. On July28 the revenue is recorded by the Company XYZ because the revenue has been recognized when it is earned.

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Answer 4

Textbook Question

Chapter 3, Problem 1DQ

If XYZ Consulting performs a consulting service, bills the customer on June 28, and receives payment from the customer on July 19, on what date would revenue be recorded if

a. XYZ uses the cash basis of accounting?
b. XYZ uses the accrual basis of accounting?

Expert Solution & Answer

To determine

Record the revenue in which date.

Explanation of Solution

Accrual basis of accounting:

Accrual basis of accounting refers to recognizing the financial transactions during the period in which the event occurs, even if the cash is not exchanged.

Cash basis of accounting:

Cash basis of accounting refers to the recognition of financial transactions only when the cash is received or paid.

Record the revenue in which date:

a. On July19 the revenue is recorded by the Company XYZ because cash has been received from the customer.

b. On July28 the revenue is recorded by the Company XYZ because the revenue has been recognized when it is earned.

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Answer 5

Textbook Question

Answer 6

Textbook Question

Answer 7

Expert Solution & Answer

To determine

Record the revenue in which date.

Explanation of Solution

Accrual basis of accounting:

Accrual basis of accounting refers to recognizing the financial transactions during the period in which the event occurs, even if the cash is not exchanged.

Cash basis of accounting:

Cash basis of accounting refers to the recognition of financial transactions only when the cash is received or paid.

Record the revenue in which date:

a. On July19 the revenue is recorded by the Company XYZ because cash has been received from the customer.

b. On July28 the revenue is recorded by the Company XYZ because the revenue has been recognized when it is earned.

Answer 8

Expert Solution & Answer

To determine

Record the revenue in which date.

Explanation of Solution

Accrual basis of accounting:

Accrual basis of accounting refers to recognizing the financial transactions during the period in which the event occurs, even if the cash is not exchanged.

Cash basis of accounting:

Cash basis of accounting refers to the recognition of financial transactions only when the cash is received or paid.

Record the revenue in which date:

a. On July19 the revenue is recorded by the Company XYZ because cash has been received from the customer.

b. On July28 the revenue is recorded by the Company XYZ because the revenue has been recognized when it is earned.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

To determine

Record the revenue in which date.

Answer 12

Explanation of Solution

Accrual basis of accounting:

Accrual basis of accounting refers to recognizing the financial transactions during the period in which the event occurs, even if the cash is not exchanged.

Cash basis of accounting:

Cash basis of accounting refers to the recognition of financial transactions only when the cash is received or paid.

Record the revenue in which date:

a. On July19 the revenue is recorded by the Company XYZ because cash has been received from the customer.

b. On July28 the revenue is recorded by the Company XYZ because the revenue has been recognized when it is earned.

Answer 13

Ch. 3 - If XYZ Consulting performs a consulting service,...Ch. 3 - Prob. 2DQ Ch. 3 - Prob. 3DQ Ch. 3 - Prob. 4DQ Ch. 3 - Prob. 5DQ Ch. 3 - Prob. 6DQ Ch. 3 - Prob. 7DQ Ch. 3 - Prob. 8DQ Ch. 3 - What kind of account is accumulated depreciation?...Ch. 3 - Prob. 10DQ

If XYZ Consulting performs a consulting service, bills the customer on June 28, and receives payment from the customer on July 19, on what date would revenue be recorded if a. XYZ uses the cash basis of accounting? b. XYZ uses the accrual basis of accounting?

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