Quiz Submissions - Quiz Submissions Midterm Exam Part I...

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Quiz Submissions - Midterm Exam Part I Attempt 1 Written: Mar 13, 2017 8:47 AM - Mar 13, 2017 10:03 AM Submission View Released: Jun 15, 2014 3:46 AM Available until: Mar 20, 2017 8:42 AM Feedback after End of Due Date Question 1 1 / 1 point Which of the following cannot be engaged in managing the business? a limited partner a general partner a sole proprietor none of these Question 2 1 / 1 point One reason for the existence of agency problems between managers and share holders is that: managers know how to manage the firm better than shareholders. there is a separation of ownership and control of the firm. shareholders have unreasonable expectations about managerial performance. none of these. Question 3 1 / 1 point On June 23, 20X8, Mikhal Cosmetics sold $250,000 worth of its products to Rynex Corporation. The goods were shipped to Rynex on July 2. The payment from Rynex was received on September 20. Under the "cash basis of accounting" revenue should be recorded on: June 23, 20X8. July 2, 20X8. September 20, 20X8. none of the above Hide Feedback
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Under the accrual basis of accounting, if an entity receives payment in advance from a customer, then the entity records this payment as a liability, not as revenue. Only after it has completed all work under the arrangement with the customer can it recognize the payment as revenue. Under the cash basis of accounting, you should record revenue when a cash payment has been received. For example, using the same scenario as just noted, the snow plowing service will not recognize revenue until it has received payment from its customer, even though this may be a number of weeks after the plowing service completes all work.
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