1. Undercash-basis accounting, when is revenue recorded? When is itrecorded under accrual-basis accounting?
2. Under accrualaccounting, when is revenue considered earned?
3. If amembership represents an advance payment for services provided,when is it recognized as revenue under the accrual basis, and whatis it called?
4. Why isinsurance expense spread over multiple periods even though thepolicy coverage is paid in advance?
5. At the end ofthe month for Silverâs Gym, what entries need to be made under thecash basis of accounting for wages that have not yet been paid?What entries need to be made under the accrual method?
6. Why is itimportant to match expenses and revenues to reflect the performanceof a business over a particular time period?
7. When mightthe use of cash basis accounting overstate the actual profitsearned by Silverâs gym? When might it understate the actual profitsearned?
8. Which basisof accounting is in accordance with GAAP for large companies?
1. Undercash-basis accounting, when is revenue recorded? When is itrecorded under accrual-basis accounting?
2. Under accrualaccounting, when is revenue considered earned?
3. If amembership represents an advance payment for services provided,when is it recognized as revenue under the accrual basis, and whatis it called?
4. Why isinsurance expense spread over multiple periods even though thepolicy coverage is paid in advance?
5. At the end ofthe month for Silverâs Gym, what entries need to be made under thecash basis of accounting for wages that have not yet been paid?What entries need to be made under the accrual method?
6. Why is itimportant to match expenses and revenues to reflect the performanceof a business over a particular time period?
7. When mightthe use of cash basis accounting overstate the actual profitsearned by Silverâs gym? When might it understate the actual profitsearned?
8. Which basisof accounting is in accordance with GAAP for large companies?
