ACCOUNTING PRINCIPLES Four statements are given below. a. A company recognizes revenue when the goods are delivered to a customer, even though cash will not be collected from the customer for 30 days. b. Land, located in a desirable location, is reported at the original acquisition price, even though its value has increased by over 100 percent since it was purchased. c. The cost paid for a delivery truck is recorded as an asset and expensed over the next five years as it is used to help generate revenue. d. Inventory, which was recently damaged by a flood, is reported at the lower of its cost or market value.
ACCOUNTING PRINCIPLES Four statements are given below. a. A company recognizes revenue when the goods are delivered to a customer, even though cash will not be collected from the customer for 30 days. b. Land, located in a desirable location, is reported at the original acquisition price, even though its value has increased by over 100 percent since it was purchased. c. The cost paid for a delivery truck is recorded as an asset and expensed over the next five years as it is used to help generate revenue. d. Inventory, which was recently damaged by a flood, is reported at the lower of its cost or market value.
Chapter3: Analyzing And Recording Transactions
Section: Chapter Questions
Problem 1PA: For each of the following situations write the principle, assumption, or concept that justifies or...
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ACCOUNTING PRINCIPLES
Four statements are given below.
a. A company recognizes revenue when the goods are delivered to a customer, even though cash will not be collected from the customer for 30 days.
b. Land, located in a desirable location, is reported at the original acquisition price, even though its value has increased by over 100 percent since it was purchased.
c. The cost paid for a delivery truck is recorded as an asset and expensed over the next five years as it is used to help generate revenue.
d. Inventory, which was recently damaged by a flood, is reported at the lower of its cost or market value.
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