The following situations are independent and assume the business uses accrual accounting. (a)Sam Company completes a job for a customer for$4,000. The job was completed from June 15th. to July 15th. The customer pays Sam Company $1,000 on June 15th., $2,600 on July 15th and $400on September 1st. How much revenue should Sam Company record (accrue) in June, July & September? Explain your answer and show your calculations. (c) On January 1st. an insurance company sells a one year insurance policy for $4,200 that willexpire on December 31. How much revenue should be accrued in each month from Jan to December.
The following situations are independent and assume the business uses accrual accounting. (a)Sam Company completes a job for a customer for$4,000. The job was completed from June 15th. to July 15th. The customer pays Sam Company $1,000 on June 15th., $2,600 on July 15th and $400on September 1st. How much revenue should Sam Company record (accrue) in June, July & September? Explain your answer and show your calculations. (c) On January 1st. an insurance company sells a one year insurance policy for $4,200 that willexpire on December 31. How much revenue should be accrued in each month from Jan to December.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
The following situations are independent and assume the business uses accrual accounting.
(a)Sam Company completes a job for a customer for$4,000. The job was completed from June 15th. to July 15th. The customer pays Sam Company $1,000 on June 15th., $2,600 on July 15th and $400on September 1st. How much revenue should Sam Company record (accrue) in June, July & September? Explain your answer and show your calculations.
(c) On January 1st. an insurance company sells a one year insurance policy for $4,200
that willexpire on December 31. How much revenue should be accrued in each month
from Jan to December.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education