Homework 4

Homework 4 - Chapter 4 Homework Jackie Gragnola BUS 214,...

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Chapter 4 Homework Jackie Gragnola BUS 214, Bissonnette MW2-4 1/30/09 3.) The law firm should recognize revenue from his engagement in May because that is when he is paid, and until then, it is unearned revenue which is a liability. When he is paid, it becomes a revenue in the retained earnings section. 13.) The result of these transactions will be a $100,000 increase in cash and a $100,000 increase in unearned revenue which is a liability. So this event will have no effect on the income statement because the income statement is revenues less expenses. Therefore, this event will affect the balance sheet only at this time, but will affect the income statement later, after the task is completed and is counted as a revenue. 15.) Revenue earned but not yet received would go in the (a) assets account because it is an account receivable. This account would be debited. Also, (c) revenue would be credited because it is a service revenue completed. 16.) The (b) liabilities would be credited and the (d) expenses would be debited.
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This note was uploaded on 11/21/2011 for the course BUS 214 taught by Professor Waker during the Winter '08 term at Cal Poly.

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Homework 4 - Chapter 4 Homework Jackie Gragnola BUS 214,...

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