Chapter 3, Problem 4ME

Identifying Accrual Basis Expenses

The following transactions are July activities of Bill’s Extreme Bowling, Inc., which operates several bowling centers. If an expense is to be recognized in July, indicate the amount. If an expense is not to be recognized in July, explain why.

Activity	Amount or Explanation
a. Bill’s paid $1,500 to plumbers for repairing a broken pipe in the restrooms.
b. Bill’s paid $2,000 for the June electricity bill and received the July bill for $2,500, which will be paid in August.
c. Bill’s paid $5,475 to employees for work in July.