Homework Answers
Question 8:
CORRECT OPTION
- Decrease in Cash and Increase in Land
Explaination:
- The journal entry for purchase of land for cash is,
Land a/c Dr. ×××
To Cash a/c ××××
- The entry implies that there is an
- increase in assets since land is an assets and has been debited
- Decrease in cash since cash outflow from our hands and has been credited
- Thus, as an affect, there is an decrease in cash and increase of land.
Question 9:
CORRECT OPTION
- Total assets remains unchanged
Explanation:
- Cash recieved as fee earned, $5000 is a servuce revenue and the entry is an follows.
Cash a/c $5000
To Service revenue $5000
- Since there is an accrual of service revenue of $5000, there will be an increase in Net income by $5000.
- If net income increases then the retained earnings balance also increases.
- If retained earnings balance increases then the total shareholders equity aslo increase.
- On the other hand, if cash received from anyone, there will be increase in cash balance which is a curebt asset for any business. Hence there is an increase in total assets. But here it was given that total assets remains unchnaged.
- So, here from the given options, the odd one out is total assets remains unchanged which is a false statement.
_____×_____
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Can you answer that for me and explain why?
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can you give me the answer and explain why?also can you explain why C is incorrect....
can you give me the answer and explain why?also can you explain
why C is incorrect. thx
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can you give me the answer and explain why?also can you explain
why C is incorrect. thx
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