FINANCIAL + MANAGERIAL ACCOUNTING W/CONN
9th Edition
ISBN: 9781264776788
Author: Wild
Publisher: MCG
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Question
Chapter 3, Problem 35QS
To determine
Introduction:
To choose: The correct option from the given options.
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Businesses using the allowance method for the recognition of uncollectible accounts expense commonly experience four accounting
events:
a. Recognition of uncollectible accounts expense through a year-end adjusting entry.
b. Write-off of uncollectible accounts.
c. Recognition of revenue on account.
d. Collection of cash from accounts receivable.
Required
Show the effect of each event on the elements of the financial statements, using a horizontal statements model like the one shown
here. Use the following coding scheme to record your answers: increase is +, decrease is –, leave the cell blank for not affected. In the
cash flow column, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). The first
transaction is entered as an example.
Effect of Events on the Financial Statements
Balance Sheet
Income Statement
Stockholders'
Net
Event
Assets
Liabilities
Revenue
Expense
Cash Flow
Equity
Income
1.
%3D
+
2.
3.
4.
+
Deferred revenues represent liabilities recorded when cash is received from customers in advance of providing a good or service. What adjusting journal entry is required at the end of a period to recognize the amount of deferred revenues that were recognized during the period?
The revenue recognition principle dictates that revenue should be recognized in the accounting records
Select one:
a. when cash is received.
b. in the period that income taxes are paid.
c. when the performance obligation is satisfied.
d. at the end of the month.
Chapter 3 Solutions
FINANCIAL + MANAGERIAL ACCOUNTING W/CONN
Ch. 3 - Prob. 1QSCh. 3 - Computing accrual and cash income C1 In its first...Ch. 3 - Identifying accounting adjustments P1 Classify the...Ch. 3 - Prob. 4QSCh. 3 - Prepaid (deferred) expenses adjustments P1 For...Ch. 3 - Prepaid (deferred) expense adjustments P1 For each...Ch. 3 - Prob. 7QSCh. 3 - Prob. 8QSCh. 3 - Prob. 9QSCh. 3 - Prob. 10QS
Ch. 3 - Prob. 11QSCh. 3 - Prob. 12QSCh. 3 - Prob. 13QSCh. 3 - Prob. 14QSCh. 3 - Prob. 15QSCh. 3 - Prob. 16QSCh. 3 - Prob. 17QSCh. 3 - Prob. 18QSCh. 3 - Prob. 19QSCh. 3 - Prob. 20QSCh. 3 - Prob. 21QSCh. 3 - Prob. 22QSCh. 3 - Prob. 23QSCh. 3 - Identifying post-closing accounts P5 Identify...Ch. 3 - identifying the accounting cycle C2 List the...Ch. 3 - Prob. 26QSCh. 3 - Prob. 27QSCh. 3 - Prob. 28QSCh. 3 - Prob. 29QSCh. 3 - Prob. 30QSCh. 3 - Prob. 31QSCh. 3 - Prob. 32QSCh. 3 - Prob. 33QSCh. 3 - Prob. 34QSCh. 3 - Prob. 35QSCh. 3 - Prob. 36QSCh. 3 - Prob. 37QSCh. 3 - Prob. 38QSCh. 3 - Prob. 39QSCh. 3 - Prob. 40QSCh. 3 - Prob. 1ECh. 3 - Prob. 2ECh. 3 - Prob. 3ECh. 3 - Prob. 4ECh. 3 - Prob. 5ECh. 3 - Prob. 6ECh. 3 - Prob. 7ECh. 3 - Prob. 8ECh. 3 - Prob. 9ECh. 3 - Prob. 10ECh. 3 - Prob. 11ECh. 3 - Prob. 12ECh. 3 - Prob. 13ECh. 3 - Prob. 14ECh. 3 - Prob. 15ECh. 3 - Prob. 16ECh. 3 - Prob. 17ECh. 3 - Prob. 18ECh. 3 - Prob. 19ECh. 3 - Prob. 20ECh. 3 - Prob. 21ECh. 3 - Prob. 22ECh. 3 - Prob. 23ECh. 3 - Prob. 24ECh. 3 - Prob. 25ECh. 3 - Prob. 26ECh. 3 - Prob. 27ECh. 3 - Prob. 28ECh. 3 - Prob. 29ECh. 3 - Prob. 30ECh. 3 - Prob. 31ECh. 3 - Prob. 32ECh. 3 - Prob. 33ECh. 3 - Prob. 34ECh. 3 - Prob. 35ECh. 3 - Prob. 36ECh. 3 - Prob. 37ECh. 3 - Prob. 1PSACh. 3 - Prob. 2PSACh. 3 - Prob. 3PSACh. 3 - Prob. 4PSACh. 3 - Prob. 5PSACh. 3 - Prob. 6PSACh. 3 - Prob. 7PSACh. 3 - Prob. 8PSACh. 3 - Prob. 9PSACh. 3 - Prob. 10PSACh. 3 - Prob. 11PSACh. 3 - Prob. 1PSBCh. 3 - Prob. 2PSBCh. 3 - Prob. 3PSBCh. 3 - Prob. 4PSBCh. 3 - Prob. 5PSBCh. 3 - Prob. 6PSBCh. 3 - Prob. 7PSBCh. 3 - Prob. 8PSBCh. 3 - Prob. 9PSBCh. 3 - Prob. 10PSBCh. 3 - Prob. 11PSBCh. 3 - No Account Title Debit Credit 101 Cash $38,264 106...Ch. 3 - Prob. 1GLPCh. 3 - Prob. 2GLPCh. 3 - Prob. 3GLPCh. 3 - Prob. 4GLPCh. 3 - Prob. 1.1AACh. 3 - Prob. 1.2AACh. 3 - Prob. 1.3AACh. 3 - Prob. 1.4AACh. 3 - Prob. 2.1AACh. 3 - Prob. 2.2AACh. 3 - Prob. 2.3AACh. 3 - Prob. 2.4AACh. 3 - Prob. 3.1AACh. 3 - Prob. 3.2AACh. 3 - What is the difference between the cash basis and...Ch. 3 - Why is the accrual basis of accounting generally...Ch. 3 - What type of business is most likely to select a...Ch. 3 - Prob. 4DQCh. 3 - Prob. 5DQCh. 3 - Prob. 6DQCh. 3 - Prob. 7DQCh. 3 - Prob. 8DQCh. 3 - Prob. 9DQCh. 3 - Prob. 10DQCh. 3 - Prob. 11DQCh. 3 - Prob. 12DQCh. 3 - Prob. 13DQCh. 3 - Prob. 14DQCh. 3 - Prob. 15DQCh. 3 - Prob. 16DQCh. 3 - Prob. 17DQCh. 3 - Prob. 18DQCh. 3 - Prob. 1BTNCh. 3 - Prob. 4BTN
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- Concept Introduction: Adjusting entries are required to adjust the accounts according to the accrual basis of accounting at the end of the every accounting period. For example: Recording the depreciation expense on depreciable assets at the end of each accounting year. The business activity for each type of adjusting entry is explained as follows: Accrued revenue: The adjusting entry for Accrued revenue is prepared to record the revenue earned during the period. Accrued Expense: The adjusting entry for Accrued expense is prepared to record the expenses incurred during the period. Deferred Revenue: The adjusting entry for Deferred revenue is prepared to defer the revenue that belong to next period. Deferred expenses: The adjusting entry for Deferred expense is prepared to defer the expense that belong to next period. Depreciation: The adjusting entry for depreciation expense is prepared to record the depreciation expense that belong to current period. Requirement-1: To prepare: The…arrow_forwardAllowance for Uncollectible Accounts is a contra asset account, which means that its normal balance is a credit. However, it is possible for the account to have a debit balance before year-end adjustments are recorded. Explain how this could happen. How does an accountant calculate the year-end adjustment for Allowance for Uncollectible Accounts with a debit balance before year-end adjustments recorded? Please explain both answers in good detail answerarrow_forwardWhy are adjusting entries recorded at the end of the accounting period? Multiple Choice The Cash account must be adjusted for the effects of the daily transactions with customers and creditors. Unrecorded accruals and deferrals must be recognized before the financial statements can be prepared. The data from the temporary accounts (revenues, expenses, and dividends) must be moved into the retained earnings account. The company's accounts must be adjusted to ensure that debits are equal to credits prior to preparing the trial balance.arrow_forward
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- Reversing entries are made at the beginning of the new accounting period in order totransfer all accruals and deferral items established by adjusting entries to nominal accountthat are to be used in recording transactions during the new period. True Falsearrow_forwardWhich of the following statements concerning reversing entries is true? a. Reversing entries are required by Generally Accepted Accounting Principles. b. Reversing entries are most often used with accrual-type adjustments. c. Reversing entries are dated December 31, the end of the fiscal year. d. Reversing entries are recorded before adjusting entries.arrow_forwardCal Consulting follows the practice that prepayments are debited to expense when paid, and unearned revenues are credited to revenue when cash is received. Given this company’s accounting practices, which one of the following applies to the preparation of adjusting entries at the end of its first accounting period? a. Unearned fees (on which cash was received in advance earlier in the period) are recorded with a debit to Consulting Fees Earned of $500 and a credit to Unearned Consulting Fees of $500. b. Unpaid salaries of $400 are recorded with a debit to Prepaid Salaries of $400 and a credit to Salaries Expense of $400. c. Office supplies purchased for the period were $1,000. The cost of unused office supplies of $650 is recorded with a debit to Supplies Expense of $650 and a credit to Office Supplies of $650. d. Earned but unbilled (and unrecorded) consulting fees for the period were $1,200, which are recorded with a debit to Unearned Consulting Fees of $1,200 and a credit to…arrow_forward
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