Comparing cash and accrual basis accounting and applying the revenue recognition principle Momentous Occasions is a photography business that shoots videos at college parties. The freshman class pays $1,000 in advance on March 3 to guarantee services for its party to be held on April 2. The sophomore class promises a minimum of $2,800 for filming its formal dance and actually pays cash of $4,100 on February 28 at the dance. Answer the following questions about the correct way to account for revenue under the accrual basis: Considering the $1,000 paid by the freshman class, on what date was revenue earned? Did the earnings occur on the same date cash was received? Considering the $4,100 paid by the sophomore class, on what date was revenue earned? Did the earnings occur on the same date cash was received?
Comparing cash and accrual basis accounting and applying the revenue recognition principle Momentous Occasions is a photography business that shoots videos at college parties. The freshman class pays $1,000 in advance on March 3 to guarantee services for its party to be held on April 2. The sophomore class promises a minimum of $2,800 for filming its formal dance and actually pays cash of $4,100 on February 28 at the dance. Answer the following questions about the correct way to account for revenue under the accrual basis: Considering the $1,000 paid by the freshman class, on what date was revenue earned? Did the earnings occur on the same date cash was received? Considering the $4,100 paid by the sophomore class, on what date was revenue earned? Did the earnings occur on the same date cash was received?
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter1: Introduction To Business Activities And Overview Of Financial Statements And The Reporting Process
Section: Chapter Questions
Problem 40P
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Comparing cash and accrual basis accounting and applying the revenue recognition principle
Momentous Occasions is a photography business that shoots videos at college parties. The freshman class pays $1,000 in advance on March 3 to guarantee services for its party to be held on April 2. The sophomore class promises a minimum of $2,800 for filming its formal dance and actually pays cash of $4,100 on February 28 at the dance. Answer the following questions about the correct way to account for revenue under the accrual basis:
- Considering the $1,000 paid by the freshman class, on what date was revenue earned? Did the earnings occur on the same date cash was received?
- Considering the $4,100 paid by the sophomore class, on what date was revenue earned? Did the earnings occur on the same date cash was received?
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