During June, the Grass Is Greener Company mows 100 lawns a week; the company bills customers...

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During June, the Grass Is Greener Company mows 100 lawns a week; the company bills customers...

During June, the Grass Is Greener Company mows 100 lawns a week; the company bills customers and full payment is due by July 15. The company uses the accrual basis of accounting. How will these events affect the company's financial statements?

Multiple Choice

In July, an asset account will increase and a liability account will decrease.
In July, a liability account will decrease and a revenue account will increase.
In June, an asset and a liability account will both increase.
In June, an asset and a revenue account will both increase.

business accounting

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Answer 1

Answer #1

Correct answer----------In June, an asset and a revenue account will both increase.

.

When customer are billed in june the accounts receivable account will be debited hence asset will increase and at the same time service revenue will increase with the amount of billings made to customers. There will be no effect on liability in June or July for this transaction.

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Answer 2

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During June, the Grass Is Greener Company mows 100 lawns a week; the company bills customers...

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