b. an asset or contra asset account and an expense account ca liability account

Question

b. an asset or contra asset account and an expense account ca liability account and an expense account. a receivable account and a revenue account Pappy Corporation received cash of $36,000 on September 1, 2017 for one year's rent in advance and recorded the transaction with a credit to Unearned Rent Reve December 31, 2017 adjusting entry is a. debit Rent Revenue and credit Unearned Rent Revenue, $12,000. b. debit Rent Revenue and credit Unearned Rent Revenue, $24,000. 10. b,000 36 debit Unearned Rent Revenue and credit Rent Revenue, $12,000. d. debit Cash and credit Unearned Rent Revenue, $24,000 11. Th e income statement provides investors and creditors with information to predict all of the following except the: amount of future cash flows. . sources of future cash flows. c. timing of future cash flows d. uncertainty of future cash flows. 2. Which of the following is an advantage of the single-step income statement over the multiple-step income statement? a. It reports gross profit for the year. b. Expenses are classified by function. c. It matches costs and expenses with related revenues. It does not imply that one type of revenue or expense has priority over another.

Explanation / Answer

Question no:10 Answer is Option ( C) Debit unearned rent revenue and credit rent revenue for amount $12000 Adjusting entry for rent from the Advance rent date Account titles debit Credit dec31,2017 unearned rent revenue A/c 12000            To Rent revenue A/c 12000 (being adjusting entry for rent revenue has been reocrded) Rent for sep to december (4 months) =$36000*4/12=$12000 Question no:11 Answer is option (b) Sources of future cash flows Income statement provides to investors and creditors with information that it is helps them predict the amounts, timing, and uncertainty of future cash flows Question no:12 Answer is option : (d) it does not imply that one type of revenue or expense has priority over another Single step income statement is a simple income statement. It shows Expesnes and Income in single line for the purpose of net Income. It does not give any priority to any expenses

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