Why are payments received from customers in advance, for either services to be performed and/or for goods to be delivered, classified as liabilities upon the receipt of the funds?

Q: When income is to be recognized on cash basis. by Safe Trust Bank, a distinction should be made…

A: In case of performing assets, the income should be recognised in accrual basis.  However, in case of…

Q: w are statement of cash flows used to evaluate a loan request for a prospective borro

A: While giving the loan the lender there is need of cash flow statement is required specially when…

Q: Gains and losses on disposals of assets: Why are gains and losses on disposals of assets treated as…

A: Gains and losses on disposal of assets are notional gains and losses reported in the income…

Q: The measurement of money is related to: A. Investment of funds B. Reporting sources of funds C.…

A: Money measurement concept is an accounting principle that categorizes which transactions and events…

Q: A credit balance to a client's accounts payable account representing right to receive payment for…

A: Liabilities are of two types current and noncurrent liabilities. Current liabilities are to be…

Q: Discuss the realization principle and how it is applied in the recognition of revenue. Does the…

A: Definition: The revenue recognition principle: The revenue recognition principle refers to the…

Q: The process of payment of cash for expenditures is known as: O a. Disbursement O b. Expenditures O…

A: An expenditure is amounts used by a business, organization, or corporation to acquire new assets,…

Q: True Or False?  The entry to record a cash receipt from a customer when the service is to be…

A: The assets are debited and liabilities are credited.

Q: are payments and receipts of interest classified as operating activities rather than as financing or…

A:

Q: How to adjust net income to cashflow.

A: In cashflow there are 2 methods for calculating operating cash flow, they are: a. Direct Method b.…

Q: Emoluments, pensions and gratuities, as well as debt service charges are categorized asdevelopment…

A: First of all we need to understand the basic meaning of Development expenditure. Development…

Q: How transaction between and users of funds take place? How would they prove that there was a…

A: Financial markets are the place where buyers and sellers interact and transact business. The…

Q: What is the difference between cash basis accounting and accrual basis accounting?

A: Accounting: Accounting is a system, or a process of collecting and organizing economic transactions,…

Q: Aliability created for receiving cash for future services to be provided is termed a(n) O service…

A: Introduction: Balance sheet: All Assets and liabilities are shown in Balance sheet. It tells the net…

Q: What is the difference between the cash basis and the accrual basis of accounting?

A: The accounting is a process to identify the business transactions, record the transactions and…

Q: Money received from customers for products to be delivered in the future is recorded as: B . an…

A: Cash received from the customers will be considered as an asset. Whereas a liability will be created…

Q: Which of the following is not a pervasive expense recognition principle? a. immediate recognition…

A: Option C - Cash Payment is not a pervasive expense recognition principle.

Q: From a bank's viewpoint, a customer's account in the bank is considered a: a.donation. b.liability.…

A: Bank statement: This is a periodic or monthly statement issued by bank reporting the account summary…

Q: Which function of money allows individuals to make payment now in return for goods and services? A.…

A: Medium of exchange : Money serves as a medium of exchange. Money facilitates exchange of goods…

Q: Under what circumstances should sellers consider the time value of money when recognizing revenue?

A:

Q: What steps are taken to prepare Income and Expenditure Account from a Receipt and Payment Account?

A: Introduction: Non-trading entities keep a revenue and expenditure account to determine the surplus…

Q: When using the indirect method of determining net cash flows from operating activities, how is…

A: Cash flow statement (CFS) is a type of financial statement that gives a summary related to all the…

Q: Money received from customers for products to be delivered in the future is recorded as: A . revenue…

A: The question is based on the concept accounting principle and concept. The income received in…

Q: suppliers and creditors evaluate the liquidity of a client based on their payment behavior

A: Liquidity means the ability of the business to meet its short term obligations.

Q: Using accrual accounting, when is revenue recognized? A. When cash transfers B. When the…

A: There are two type of accounting merhods used in business. One is cash basis of accounting and other…

Q: ansactions between supp

A: Introduction : Financial markets can be defined as the marketplaces where fund providers as well as…

Q: Identify whether each of the following transactions, which are related to revenue recognition, are…

A: Revenue means the amount earned by selling the goods or services. Revenue is recognized in books of…

Q: How transactions between suppliers and users of funds take place. How would you prove that there was…

A: Financial markets are marketplaces where fund suppliers and fund demanders can do business.…

Q: Why aren’t transactions involving accounts payable considered to be financing activities?

A: Answer: Accounts payable is current liability which is used in computing working capital, excess of…

Q: When initially recognizing the cash surrender value, what is the reason behind the allocation…

A: According to this principle of accounting, the revenues and expenses stated in the income statement…

Q: Quick assets include which of the following?     "Cash, prepaid rent, and receivables."     "Cash,…

A: Quick Assets include followings-

Q: Identify whether each of the following transactions, which are related to revenue recognition, are…

A: Revenue recognition principle says that revenue should be recognised in business when it is earned.…

Q: Classify each as an asset, liability, cash inflow, or cash outflow:

A: Solution:- Asset means something that an individual owns and holds and also get benefit from it in…

Q: Assets available for unsecured creditors after payments of liabilities with priority are calculated…

A: Liquidation is the process of selling all the assets of the business at their fair value and using…

Q: (a) Distinguish between Money measurement concept and matching concept.

A: Accounting concepts are those rules, regulations and guidelines which are used for completion of…

Q: The portion of an entity’s cash account that is held as a compensating balance must be aggregated…

A: A compensating balance refers to the minimum portion of an entity’s cash account that a borrower…

Q: Due to the increased need for security for the performance of obligations arising from these…

A: The main function of financial institutions is to transfer capital from savers (having idle funds)…

Q: In financial accounts, how are interfund transactions accounted for

A: An accounting firm's financial statements serve as concise summaries of its activities, conveyed…

Q: Financing activities involve O cash receipts from sales of goods and services. O long-term liability…

A: Cash receipts from sale of goods and services are operating activities. Therefore, this option is…

Q: ___________liabilities is created when a company receives cash for services to be provided in the​…

A: Liabilities: In the financial world, liabilities are creditors' claims on a company's assets or…

Q: Receive cash from customers in settement of debts owed by them

A: Receive cash from customers in settement of debts owed by them.  Required  Journal Entry.

Q: What are the use of primary tools, and how are they used by lenders when determining whether they…

A: The primary tools used by the lenders include the 5 C's of credit, which helps the lenders in…

Bookkeeping

Bookkeeping is the process of recording the financial transactions of a company on a regular basis. With the process of bookkeeping, companies can track important financial information that helps management in making crucial decisions.