For each of the following separate situations, determine the amount of expense each company should recognize in December (using accrual basis accounting). a. Chipotle has monthly wages expense of $5,000 that has been incurred but not paid as of December 31. b. United Airlines purchases a 24-month insurance policy for $75,000 on December 1 for immediate coverage. c. On December 15, Pfizer prepays $38,000 for hotel rooms for its January sales meeting. Expense recognized in December Situations a. Wages expense incurred but not paid b. Purchases a 24-month insurance policy c. Prepays for hotel rooms for its annual sales meeting
For each of the following separate situations, determine the amount of expense each company should recognize in December (using accrual basis accounting). a. Chipotle has monthly wages expense of $5,000 that has been incurred but not paid as of December 31. b. United Airlines purchases a 24-month insurance policy for $75,000 on December 1 for immediate coverage. c. On December 15, Pfizer prepays $38,000 for hotel rooms for its January sales meeting. Expense recognized in December Situations a. Wages expense incurred but not paid b. Purchases a 24-month insurance policy c. Prepays for hotel rooms for its annual sales meeting
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter5: Closing Entries And The Post-closing Trial Balance
Section: Chapter Questions
Problem 8E: Considering the following events, determine which month the revenue or expenses would be recorded...
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