Comparing accrual and cash basis accounting [15-25 min]
Smith’s Stews, Inc., completed the following transactions during April, 2012:
Apr 1 | Prepaid rent for April through July, $4,800. |
2 | Purchased computer for cash, $3,600. |
3 | Performed catering services on account, $3,400. |
5 | Paid Internet service provider invoice, $225. |
6 | Catered wedding event for customer and received cash, $2,000. |
8 | Purchased $130 of supplies on account. |
10 | Collected $1,900 on account. |
14 | Paid account payable from April 8. |
15 | Paid salary expense, $1,000. |
30 | Recorded adjusting entry for rent (see April 1). |
30 | Recorded $100 depreciation on computer. |
30 | There are $35 of supplies still on hand. |
Requirement
1. Show whether each transaction would be handled as a revenue or an expense, using both the accrual and cash basis, by completing the table.
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