Recording of revenue-accrual based accounting
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Daisy Political Consultants has been in existence for many years. During the month of November, the following events occurred.
1) The owners contributed an additional $6,500 to the business to finance an expansion of operations.
2) Consulting Services totaling $11,000 were performed on credit during November and billed to customers.
3) A loan in the amount of $25,000 was obtained from a wealthy campaign contributor.
4) Expenses in the amount of $6,000 were incurred during the month. One-third had been paid for by the end of the month.
5) Cash of $18,500 was collected from customers for whom services had been performed during September and October.
6) Services totaling $4,500 were performed for customers who had previously paid for the services during October.
Daisy uses accrual basis accounting. For which of the events above should the revenue be recorded in November? In each case, how much revenue should be recorded? If an event does not involve revenue, specify why not.
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The solution specifies in which of the cases revenue can be recorded.
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Daisy Political Consultants has been in existence for many years. During the month of November, the following events occurred.
Daisy uses accrual basis accounting. For which of the events above should the revenue be recorded in November? In each case, how much revenue should be recorded? If an event does not involve revenue, specify why not.
1) The owners contributed an additional $6,500 to the business ...
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