Question

aining Time: 1 hour, 04 minutes, 44 seconds. astion Completion Status: QUESTION 37 After going private, Dell decided to use the cash basis accounting to simplify things. The company received $100,000 in cash from customers during 2011. Dell also paid $20,000 for rent during 20x1. Considering this and using the following information, determine the amount of accrual-basis revenue Dell should recognize for 2011 Accounts receivable Unearned revenue Prepaid rent 1/1 510,000 6,000 2,000 3,000 12/31 $13,000 4,000 3,000 5,000 Rent Payable 1. Determine the amount of cash-basis revenue Dell should recognize for 2011 2 Determine the amount of accrual-basis revenue Dell should recognize for 2011, 3. Determine cash-basis rent expense Dell should recognize for 2011 4. Determine accrual basis rent expense Dell should recognize for 2011 Express your answer as an integer without S sign (Round all computations to the nearest dollar. For example, Input 100.000* # your answer is $100,000.22).

Answer 1

Solution:

1	Cash Basis Revenue	$        100,000
2	Accrual Basis Revenue [100000-10000+13000+6000-4000]	$        105,000
3	Cash Basis Rent Expense	$           20,000
4	Accrual Basis Rent Expense [20000+2000-3000+5000-3000]	$           21,000

Working:

1	Cash Basis Revenue	$        100,000	Revenue is equal to Cash Collection from customers
2	Accrual Basis Revenue [100000-10000+13000+6000-4000]	$        105,000	cash collected-opening accounts receivables+closing accounts receivables+opening unearned revenue-closing unearned revenue
3	Cash Basis Rent Expense	$           20,000	Cash paid is equal to rent expense
4	Accrual Basis Rent Expense [20000+2000-3000+5000-3000]	$           21,000	cash paid as rent+ opening prepaid rent-closing prepaid rent-opening rent payable+closing prepaid rent