Why are separate "expense" and "revenue" accounts used when all revenues and expenses could be shown...
Why are separate "expense" and "revenue" accounts used when all revenues and expenses could be shown directly in the retained earnings account?
Describe three examples of transactions that would affect a firm's income statement. For each transaction, identify if the transaction has a positive or negative effect on the firm's net income.
Homework Answers
The expenses are shown on the debit side of the income statement and the revenues are shown on the credit side of the income statement. The primary reason to show the expense and revenues separately is due to n number of entries in the accounting period for the company. All the entries are different from each other. Where one entry refers to receiving of payment before sale of goods and/or service and other would refer to after sale of good and/or services. These revenues can be classified as unearned and earned incomes.
Revenues are the assets for the company as it affects the income of the company positively, whereas the expenses effect negatively as they are cost incurred by the company in order to do the business. Retained earnings refer to the net gain which the company earns after earning revenues and deducting expenses from the revenues earned.
The three transactions that will affect the firm’s income statement are:
- Dividend received and dividend paid: In this case, the dividend received will be income of the firm and will be taken as revenue on the credit side of the income statement, where as the dividend paid will be an expensed and taken on the debit side of the income statement.
- Rent received and rent paid: In this case, the rent received will be income of the firm and will be taken as revenue on the credit side of the income statement, where as the rent paid will be an expensed and taken on the debit side of the income statement.
- Interest received and interest paid: In this case, the interest received will be income of the firm and will be taken as revenue on the credit side of the income statement, where as the interest paid will be an expensed and taken on the debit side of the income statement.
Add Answer to:
Why are separate "expense" and "revenue" accounts used when all
revenues and expenses could be shown...
ssessment 6 Saved Help Save 5418s REvenue Total Revenues 276, 000 Expenses Supplies Expense Salaries and...
ssessment 6 Saved Help Save 5418s REvenue Total Revenues 276, 000 Expenses Supplies Expense Salaries and Wages Expense Advertising Expense Office Expense 86,000 53,000 24,000 56,000 219,000 $ 57,000 Total Expenses Net Income Required: 1. Did the company generate more revenue from selling goods or providing services to customers? 2. If salaries and wages were to double, how much net income would the company report? 3-a. If the company paid $21,900 of its advertising expense during the current year, what...
Balance Sheet Accounts Assets Liabilities Equity Income Statement Accounts (Part of Equity) Revenues Expenses Question Viewer...
Balance Sheet Accounts Assets Liabilities Equity Income Statement Accounts (Part of Equity) Revenues Expenses Question Viewer Che femna tint on than in Chan Anwar as the following accounts: the accounts.) for Raymond Autobody Shop using the standard numbering system. Each account is separated by a factor of and the next asset account will 110. (Use the first available line under each section, Asset, Liabilities, etc., wher box empty; do not select any labels.) Baland 0 More Info Accounts Payable Cash...
Accounts Cash Salaries expense Accounts payable Retained earnings Utilities expense Supplies Service revenue Common stock Balances...
Accounts Cash Salaries expense Accounts payable Retained earnings Utilities expense Supplies Service revenue Common stock Balances $ 5,400 2,200 3,400 3,900 1,200 13,800 9,300 6,000 Required: Use only the appropriate accounts to prepare an income statement. COWBOY LAW FIRM Income Statement For the Period Ended December 31 Expenses: Total expenses Below are incomplete financial statements for Bulldog, Inc. Required: Calculate the missing amounts. BULLDOG, INC. Income Statement Revenues 39,000 Expenses: Salaries Advertising Utilities Net income 6,000 4.000 BULLDOG, INC. Statement...
11. What is the purpose of the statement of retained earnings? 12. What are expenses? 13....
11. What is the purpose of the statement of retained earnings? 12. What are expenses? 13. In a T-account, how are debits and credits shown? 14. Which accounts have debit balances and which accounts have credit balances? 15. What is the difference between and expense and a dividend? 16. Where does unearned revenue appear on the financial statements? 17. What is the relationship of expenses, revenues and dividends to retained earnings? 18. What is the first financial statement prepared after...
Allowance Method for Accounting for Bad Debts At the beginning of 2017, EZ Tech Company's Accounts...
Allowance Method for Accounting for Bad Debts At the beginning of 2017, EZ Tech Company's Accounts Receivable balance was $147,000, and the balance in Allowance for Doubtful Accounts was $2,500. EZ Tech's sales in 2017 were $1,100,000, 70% of which were on credit. Collections on account during the year were $710,000. The company wrote off $4,000 of uncollectible accounts during the year. Required: 1. Identify and analyze the sales during 2017. Activity Accounts Statement(s) How does this entry affect the...
SOURCES Net sales Cost of goods sold Selling expenses Administrative expenses Dividend revenue Interest revenue $1,324,900...
SOURCES Net sales Cost of goods sold Selling expenses Administrative expenses Dividend revenue Interest revenue $1,324,900 788.800 67,600 54,300 27,900 8,170 Write-off of inventory due to obsolescence Depreciation expense omitted by accident in 2016 Casualty loss Cash dividends declared Retained earnings at December 31, 2016 Effective tax rate of 34% on all items $80.970 46,300 51.500 46,010 1,020,840 Prepare a multiple-step income statement for 2017. Assume that 52.230 shares of common stock are outstanding. Round earning share SHOW LIST OF...
cant figure out retained earnings, revenue and expenses T-Accounts or Leger Accounts: Cash Beg Bal S12...
cant figure out retained earnings, revenue and expenses
T-Accounts or Leger Accounts: Cash Beg Bal S12 S14 b S4 S4 d. S47 28 $7 S10 i Accounts Receivable Beg Bal. SS 5 8 57 h End. Bal. Supplies Equipment Beg Bal. b $ 9 97 $14 54 End. Bal. $35 $5 $3-$9.95 - $7. Accumulated Depreciation Beg Ball Software $13 Sim End. Bal. SI Accumulated Amortization S8 $4 . End. Bal S13 Accounts Payable Beg Bal. S10 59 End. Bal....
do not understand why these are wrong? T-Accounts or Leger Accounts: Cash Beg Bal S12 S14...
do
not understand why these are wrong?
T-Accounts or Leger Accounts: Cash Beg Bal S12 S14 b S4 S4 d. S47 28 $7 S10 i Accounts Receivable Beg Bal. SS 5 8 57 h End. Bal. Supplies Equipment Beg Bal. b $ 9 97 $14 54 End. Bal. $35 $5 $3-$9.95 - $7. Accumulated Depreciation Beg Ball Software $13 Sim End. Bal. SI Accumulated Amortization S8 $4 . End. Bal S13 Accounts Payable Beg Bal. S10 59 End. Bal. Salaries...
Insurance Expense $ $ Service Revenue 4,500 70,000 1,400 16,000 9,000 7,200 Utilities Expense Rent Expense...
Insurance Expense $ $ Service Revenue 4,500 70,000 1,400 16,000 9,000 7,200 Utilities Expense Rent Expense Common Stock Cash Retained Earnings, January 1, 2018 Salaries Expense Accounts Payable Office Supplies Dividends Accounts Receivable Equipment 46,000 17,600 1,700 4,800 8,000 12,100 5,100 Year Ended December 31, 2018 Revenues: $ 70,000 Service Revenue Expenses: Salaries Expense Rent Expense Insurance Expense 46,000 16.000 4,500 1,400 Utilities Expense Total Expenses 67,900 2,100 Net Income Centerpiece Arrangements Statement of Retained Earnings Year Ended December 31,...
On December 31, Fighting Okra Cooking Services reports the following revenues and expenses. Service revenue Postage...
On December 31, Fighting Okra Cooking Services reports the following revenues and expenses. Service revenue Postage expense Legal fees expense Rent expense Salaries expense Supplies expense $ 71,000 1,100 2,100 10,000 19,000 10,000 In addition, the balance of common stock at the beginning of the year was $150,000, and the balance of retained earnings was $26,000. During the year, the company issued additional sharestof common stock for $20,000 and paid dividends of $10,000, Required: 1. Prepare an income statement FIGHTING...
ssessment 6 Saved Help Save 5418s REvenue Total Revenues 276, 000 Expenses Supplies Expense Salaries and Wages Expense Advertising Expense Office Expense 86,000 53,000 24,000 56,000 219,000 $ 57,000 Total Expenses Net Income Required: 1. Did the company generate more revenue from selling goods or providing services to customers? 2. If salaries and wages were to double, how much net income would the company report? 3-a. If the company paid $21,900 of its advertising expense during the current year, what...
Balance Sheet Accounts Assets Liabilities Equity Income Statement Accounts (Part of Equity) Revenues Expenses Question Viewer Che femna tint on than in Chan Anwar as the following accounts: the accounts.) for Raymond Autobody Shop using the standard numbering system. Each account is separated by a factor of and the next asset account will 110. (Use the first available line under each section, Asset, Liabilities, etc., wher box empty; do not select any labels.) Baland 0 More Info Accounts Payable Cash...
Accounts Cash Salaries expense Accounts payable Retained earnings Utilities expense Supplies Service revenue Common stock Balances $ 5,400 2,200 3,400 3,900 1,200 13,800 9,300 6,000 Required: Use only the appropriate accounts to prepare an income statement. COWBOY LAW FIRM Income Statement For the Period Ended December 31 Expenses: Total expenses Below are incomplete financial statements for Bulldog, Inc. Required: Calculate the missing amounts. BULLDOG, INC. Income Statement Revenues 39,000 Expenses: Salaries Advertising Utilities Net income 6,000 4.000 BULLDOG, INC. Statement...
SOURCES Net sales Cost of goods sold Selling expenses Administrative expenses Dividend revenue Interest revenue $1,324,900 788.800 67,600 54,300 27,900 8,170 Write-off of inventory due to obsolescence Depreciation expense omitted by accident in 2016 Casualty loss Cash dividends declared Retained earnings at December 31, 2016 Effective tax rate of 34% on all items $80.970 46,300 51.500 46,010 1,020,840 Prepare a multiple-step income statement for 2017. Assume that 52.230 shares of common stock are outstanding. Round earning share SHOW LIST OF...
cant figure out retained earnings, revenue and expenses
T-Accounts or Leger Accounts: Cash Beg Bal S12 S14 b S4 S4 d. S47 28 $7 S10 i Accounts Receivable Beg Bal. SS 5 8 57 h End. Bal. Supplies Equipment Beg Bal. b $ 9 97 $14 54 End. Bal. $35 $5 $3-$9.95 - $7. Accumulated Depreciation Beg Ball Software $13 Sim End. Bal. SI Accumulated Amortization S8 $4 . End. Bal S13 Accounts Payable Beg Bal. S10 59 End. Bal....
do
not understand why these are wrong?
T-Accounts or Leger Accounts: Cash Beg Bal S12 S14 b S4 S4 d. S47 28 $7 S10 i Accounts Receivable Beg Bal. SS 5 8 57 h End. Bal. Supplies Equipment Beg Bal. b $ 9 97 $14 54 End. Bal. $35 $5 $3-$9.95 - $7. Accumulated Depreciation Beg Ball Software $13 Sim End. Bal. SI Accumulated Amortization S8 $4 . End. Bal S13 Accounts Payable Beg Bal. S10 59 End. Bal. Salaries...
Insurance Expense $ $ Service Revenue 4,500 70,000 1,400 16,000 9,000 7,200 Utilities Expense Rent Expense Common Stock Cash Retained Earnings, January 1, 2018 Salaries Expense Accounts Payable Office Supplies Dividends Accounts Receivable Equipment 46,000 17,600 1,700 4,800 8,000 12,100 5,100 Year Ended December 31, 2018 Revenues: $ 70,000 Service Revenue Expenses: Salaries Expense Rent Expense Insurance Expense 46,000 16.000 4,500 1,400 Utilities Expense Total Expenses 67,900 2,100 Net Income Centerpiece Arrangements Statement of Retained Earnings Year Ended December 31,...
On December 31, Fighting Okra Cooking Services reports the following revenues and expenses. Service revenue Postage expense Legal fees expense Rent expense Salaries expense Supplies expense $ 71,000 1,100 2,100 10,000 19,000 10,000 In addition, the balance of common stock at the beginning of the year was $150,000, and the balance of retained earnings was $26,000. During the year, the company issued additional sharestof common stock for $20,000 and paid dividends of $10,000, Required: 1. Prepare an income statement FIGHTING...
Most questions answered within 3 hours.
-
A 60-Hz, 765-kV, three-phase overhead transmission line has two
ACSR 900 kcmil 54/3 conductors per phase....
asked 20 seconds from now -
The work done by the spring's restoring force
on the free end of a spring while...
asked 43 seconds ago -
Reynold company is considering an investment of $130,000 in
new equipment. The new equipment is expected...
asked 17 minutes ago -
If a company’s stock price (P0) goes up, and nothing else
changes, Ke (the required rate...
asked 4 minutes ago -
As a manager in today society, how can I use Harry Truman's
leadership skills and attributes...
asked 5 minutes ago -
The decomposition of SO2Cl2 is first order
and has a rate constant of + 2.90 x...
asked 6 minutes ago -
Why is protecting equipment an important element of this
concept, and how are some of the...
asked 15 minutes ago -
An asset used in a four-year project falls in the five-year
MACRS class (MACRS Table) for...
asked 17 minutes ago -
Break-even time. Hampton Corporation’s research
and development department is presenting a proposal for new product
research....
asked 20 minutes ago -
At Lake Itasca in Minnesota, the Mississippi river is only 25.0
feet wide. If you are...
asked 21 minutes ago -
A 2.0 μF parallel-plate air-filled capacitor is connected
across a 10 V battery.
(a) Determine the...
asked 32 minutes ago -
Write in Python This program:
1. Correct the compute_cells_state function which receives as
parameter an array...
asked 22 minutes ago