Week 7 - between the date of the last billing and year end b Generally not until the customer has taken the flight c Generally at the time of sale

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Suggested solutions to preparation questions – Week 7 Chapter 12 Discussion questions No. 10 a Percentage of completion method or completed contract method. b On receipt of cash the asset account ‘cash’ would increase and the liability account Revenue Received in Advance would also increase. Each month at time of issue of the magazine the liability account would decrease by 1/12 and a revenue account would increase. c Probably on delivery. d On delivery of each job. e On completion of each installation. No. 11 a At the time of billing although an accrual will be taken up at year end to cover calls made
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Unformatted text preview: between the date of the last billing and year end. b Generally not until the customer has taken the flight. c Generally at the time of sale. d Similar to (b) above except that as work is completed revenue account would be credited. e. At the time of cash sale. Problem 12.3 1 No 2 No 3 No (inventory, asset assuming perpetual) 4 No 5 No 6 No Problem 12.4 1 Not at time of taking out the loan, but an interest expense will accrue each day of the loan until it is paid. 2 Yes, electricity expense. 3 No, but $1000 will be recognised as revenue each month....
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This note was uploaded on 03/19/2012 for the course ACCT 1511 taught by Professor Kim during the Three '10 term at University of New South Wales.

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