Question

8 pt During the year, X Company sold merchandise on account to customers for $405,000. The company collected $386,000 in cash from customers during the year. Which of these amounts appears on the Income Statement and which appears on the Statement of Cash Flows? 10.AO $19,000 appears on the Income Statement and $386,000 appears on the Statement of Cash Flows BO $405,000 appears on both statements CO $386,000 appears on the Income Statement and $405,000 appears on the Statement of Cash Flows DO $405,000 appears on the Income Statement and $386,000 appears on the Statement of Cash Flows EO $19,000 appears on both statements FO $386,000 appears on both statements 8 pt On January 1, a customer paidX Company $26,400 in advance for cleaning services, so x Company recorded the receipt as Deferred Revenue. The cleaning was going to be done once in January, once in February, once in March, and once in April. What will be the result of X Company's adjusting entry on January 31? 11.AO a $6,600 decrease in the Retained Earnings account on the Balance Sheet BO a balance of $6,600 in the Deferred Revenue account on the Balance Sheet CO a $6,600 increase in the Cash account on the Balance Sheet DO a $6,600 increase in the Deferred Revenue account on the Balance Sheet EO a $6,600 decrease in the Cash account on the Balance Sheet FO revenue of $6,600 reported on the Income Statement

Answer 1

Ans 10 A Journal Entry Account Title Debit Credit Accounts Receivable $405,000 Sale $405,000 (To record sales) Cash $386,000 Accounts Receivable $386,000 (To record collection) Income Statement is a statement which shows the revenue and expense for the period Cash Flow Statement is the statement which shows the inflow and outflow of cash in the period Correct answer is option (D) i.e. "$405000 appears on the income statement and $386000 appears on the statement of cash flows" Ans 11 A Journal Entry Account Title Credit Date Debit Cash $26,400 Jan 1 Deferred Revenue (To record advance receipt) Deferred Revenue Service Revenue [$26400/4] $26,400 $6,600 Jan 31 $6,600 (To record service revenue) Correct answer is option (F) i.e. "Revenue of $6600 reported on the Income Statement"