25. Under which of the following methods of accounting is an expense recorded when it is incurred, regardless of when cash is paid?

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Asked 10/29/2011 10:17:27 PM

Updated 9/13/2015 3:13:04 PM

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User: 25. Under which of the following methods of accounting is an expense recorded when it is incurred, regardless of when cash is paid?

Weegy: The difference between cash and accrual basis accounting has to do with the time frame in which revenues and expenses are recorded and reported. Cash basis accounting will suffice if your business is a simple one. [ However, the accrual basis will give a more accurate picture of the results of business operations. Comparing cash and accrual basis accounting Cash basis accounting is a very simple form of accounting. When a payment is received for the sale of goods or services, a deposit is made, and the revenue is recorded as of the date of the receipt of funds — no matter when the sale was made. Checks are written when funds are available to pay bills, and the expense is recorded as of the check date — regardless of when the expense was incurred. The primary focus is on the amount of cash in the bank, and the secondary focus is on making sure all bills are paid. Little effort is made to match revenues to the time period in which they are earned, or to match expenses to the time period in which they are incurred. Accrual basis accounting matches revenues to the time period in which they are earned and matches expenses to the time period in which they are incurred. While it is more complex than cash basis accounting, it provides much more information about your business. The accrual basis allows you to track receivables (amounts due from customers on credit sales) and payables (amounts due to vendors on credit purchases). The accrual basis allows you to match revenues to the expenses incurred in earning them, giving you more meaningful financial reports. ]
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User: 25. Under which of the following methods of accounting is an expense recorded when it is incurred, regardless of when cash is paid? A) Cash B) Accrual C) Deferral D) Receivable

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Asked 10/29/2011 10:17:27 PM

Updated 9/13/2015 3:13:04 PM

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emdjay23

Under the accrual method of accounting an expense recorded when it is incurred, regardless of when cash is paid.

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30. The Supplies account for Vulcan Detail Company had a balance of $3,200 at the beginning of the year. Additional supplies of $13,400 were purchased during the year. A physical count of the ending inventory of supplies revealed that $5,900 of supplies was still on hand. What was total Supplies expense for the year? A) $16,400 B) $9,100 C) $10,700 D) $4,300

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Updated 9/19/2024 9:18:22 AM

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cruz30

Given:
Beginning Supplies = $3,200
Additional Supplies = $13,400
Ending Supplies = $5,900
Substitute these values into the formula:
Supplies Expense = $3,200 + $13,400 - $5,900
Supplies Expense = $16,600 - $5,900
Supplies Expense = $10,700
Therefore, the total Supplies expense for the year was $10,700.

Added 9/19/2024 9:18:22 AM

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