On January 1, 2017, the Accounts Receivable

Question 7

1.

On January 1, 2017, the Accounts Receivable of Martha Company had a debit balance of $190,000. During January, the company provided services for $400,000 on account. The company collected $240,000 from its customers on account in January. What was the ending balance in the Accounts Receivable account at the end of January?

$160,000

$590,000

$350,000

$400,000

Question 8

1.

ABC Tax Planning Service started business in January 2018. The company rented an office for $1,800 per month starting from January 1, 2018. On that day, ABC prepaid the rent through June 30. The company makes adjusting entries at the end of each month. What is the balance in the Prepaid Rent account as of April 30, 2018?

$3,600

$300

$1,800

$900

1.

Justice Company purchased a machine for $15,000 two years ago. The machine had no residual value and had an estimated useful life of 10 years. If the company uses the straight-line depreciation method, calculate the current book value of the machine.

$12,000

$3,000

$16,500

$15,000

Question 10

1.

If a company is using accrual basis accounting, when should it record revenue?

When cash is received, even though services may be performed at a later date

When services are performed, even though cash may be received at a later date

Before services are performed

When cash is received, 30 days after the completion of the services

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