62. Office Palace, Inc., leased an all-in-one printer to a new
customer, Ashley, on December 27, 2014. The printer was to
rent for $600 per month for a period of 36 months beginning
January 1, 2015. Ashley was required to pay the first and last
month's rent at the time the lease was signed. Ashley was
also required to pay a $1,500 damage deposit. Office Palace
must recognize as income for the lease:
63. The Maroon & Orange Gym, Inc., uses the accrual
method of accounting. The corporation sells memberships
that entitle the member to use the facilities at any time. A
one-year membership costs $480 ($480/12 = $40 per month);
a two-year membership costs $720 ($720/24 = $30 per
month). Cash payment is required at the beginning of the
membership period. On July 1, 2014, the company sold a
one-year membership and a two-year membership. The
company should report as gross income from the two
a. $1,200 in 2014.
b. $960 in 2014.
c. $180 in 2016.
d. $780 in 2015.
e. None of these.