BUS 020 Lecture Notes - Lecture 3: Regal Entertainment Group, Deferred Income, Deferral
2 May 2017
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Deferred expense asset- expense: cash paid before expense is incurred: an asset i. e. prepaid insurance, office supplies, property and equipment next. E4-8: unexpired costs are assets, written off and replaced with an expense as the costs expire. Somerville corp. purcahses office supplies once a month and prepares monthly financial statements. The asset account office supplies on hand has a balance of ,450 on may 1. Purchases of supplies during may amount to ,100. Supplies on hand at may 31 amount to. Deferred revenue liability- revenue: cash received before revenue is earned: liability i. e. deposits collected before construction, subscriptions collected before publication e4-11, gift certificates. Initially record a liability (unearned revenue or deferred revenue)for cash received; later record a revenue when earned in future periods. In june, fundango sold ,000 of redeemable movie tickets to individuals. Theaters honored ,800 of fundango tickets during june and was reimbursed ,500 by. Fundago who charged a issuer"s fee to regal theaters.
