Which accounting principle states that a company should "report expenses in the same period as the revenue they help generate"?

Lemming makes an $18,750, 120-day, 8% cash loan to Notions Co. on November 1. Lemming's end-of-period adjusting entry on Decembe

GREYUIT [131]

Answer:

Interest Receivable (Dr.) $250

Interest Revenue (Cr.) $250

Explanation:

Notions Co. has borrowed money from Lemming and will have to pay cost for it which is a source of fund (revenue) for Lemming. According to the Accrual concept of accounting, revenue should be recognized when earned and not when cash is received. At year end, the interest revenue of two months has been accrued, so it needs to be recognized in the Books of Lemming.

⇒ 18,750 * 8% = 1,500 p.a.

OR Interest Revenue for two months = (1,500/12) * 2 = $250.

4 0

2 years ago

Lomani Ltd acquired two new machines for cash on 1 January 2017. The cost of machine A was $400 000, plus GST, and of machine B,

cricket20 [7]

Answer:

2017

Machine A (Dr.) $400,000

Machine B (Dr.) $600,000

Cash (Cr.) $1,000,000

2018

Depreciation Expense (Dr.) $93,000

Accumulated Depreciation (Cr.) $93,000

2019

Depreciation Expense (Dr.) $93,000

Accumulated Depreciation (Cr.) $186,000

2020

Depreciation Expense (Dr.) $93,000

Accumulated Depreciation (Cr.) $279,000

2021

Machine C (Dr.) $420,000

Machine A (Cr.) $200,000

Cash (Cr.) $220,000

(To record trade in of machine A)

Repairs expense Machine B (Dr.) $66,000

Cash (Cr.) $66,000

(To record repairs of machine B)

2022

Depreciation Expense (Dr.) $79,450

Accumulated Depreciation (Cr.) $358,450

2023

Cash (Dr.) $300,000

Machine B (Cr.) $284,550

Gain on selling (Cr.) $15,450

Explanation:

Straight line depreciation recognize an assets carrying amount evenly over its useful life.

Straight line Depreciation = (Cost - Estimated Residual Value) / useful life

Depreciation expense for Machine A:

($400,000 - $20,000) / 10 years

= $38,000

Depreciation expense for Machine B:

($600,000 - $50,000) / 10 years

= $55,000

Depreciation expense for Machine C:

($420,000 - $20,000) / 8 years

= $50,000

Revised Depreciation of Machine B:

($314,000 - $19,500) / 10 years

= $29,450

6 0

2 years ago

On January 1, 2020, a company buys a piece of equipment costing $666,633 with a 14% installment note. The note will be paid off

adoni [48]

Answer:

Installment Note Schedule:

Period Beginning Balance Interest Principal Ending Balance

1. Year #1 $666,633.00 $46,664.31 $93,192.49 $573,440.51

2. Year #1 $573,440.51 $40,140.84 $99,715.97 $473,724.54

3. Year #2 $473,724.54 $33,160.72 $106,696.09 $367,028.45

4. Year #2 $367,028.45 $25,691.99 $114,164.81 $252,863.64

5. Year #3 $252,863.64 $17,700.45 $122,156.35 $130,707.29

6. Year #3 $130,707.29 $9,149.51 $130,707.29 $0.00

Explanation:

a) Data and Calculations:

Cost of equipment = $666,633

Rate of interest = 14%

Payment terms = semiannual payments over three years

Payment for each period = $139,857

Loan Amount $666,633

Loan Term 3 years 0 months

Interest Rate 14

Compound Semi-annually

Pay Back Every 6 Months

Results:

Payment Every 6 Months = $139,856.80 = $139,857 approx.

Total of 6 Payments = $839,140.82

Total Interest = $172,507.82

4 0

2 years ago

Please describe how you have prepared for your intended major, including your readiness to succeed in your upper-division course

s2008m [1.1K]

<span>My love for nature and my curiosity led me to choose Biology as my major. I wanted to pursue the branch of science most closely related to the natural world. Biology, and most specifically cell biology, allow me to see more deeply into nature. Ever since my childhood, when I spent much time hiking the nature trails and collecting bugs, I've been inspired by nature. I was drawn to all the sciences, but realized that Biology brought me closer to understanding the world around me. I have prepared for my major by taking all prerequisite courses required for a Biology major. Additionally, I have also taken electives related to Biology to broaden my knowledge base. Such electives include a History of Science course and a Botany course with a research component. Beyond courses themselves, I have contributed several science articles to my current how-write-good-college-essay's newspaper. I have also volunteered my time to do data entry for a major study being conducted by my how-write-good-college-essay's Biology department, to give me hands-on experience in the research process. As I continue to pursue my Biology major at UC, I will continue to excel academically. More importantly, I am committed to becoming an how-write-act-essayive part of the student body, especially within my department. I will seek volunteer opportunities to participate in research. Additionally, as an upperclassman, I will have the skills and experience to be of service to other students who are just beginning their Biology major. It is important to me to teach as I learn, and tutoring within my department is one way I plan to do so. Further, you will find me specializing in cell and molecular biology, my intended emphasis.</span>

3 0

2 years ago

An individual works downtown and pays $600 per month in rent for an apartment located 10 miles from her office. She has calculat

zmey [24]

Answer:

Option (B) is correct.

Explanation:

For a 20 workday month,

cost of gas and productivity = $4 per day

cost of commuting = cost of gas and productivity × 20 workday month

= $4 × 20

= $80.

The total rent he is paying currently is $600 per month that does not include the commuting cost.

Hence, the individual must willing to pay a total of:

= Total rent + Cost of commuting

= $600 + $80

= $680 for an apartment downtown.

Thus, the total amount to be paid willingly is $680.

8 0

2 years ago