42. The periodicity assumption states that: a.a transaction can only affect one period of time.b.estimates should not be made if a transaction affects more than one time period.c.adjustments to the enterprise's accounts can only be made in the time period when thebusiness terminates its operations.d.the economic life of a business can be divided into artificial time periods. 43. Which of the following is not generally an accounting time period? 44. The revenue recognition principle dictates that revenue should be recognized in theaccounting records: 45. Otto’s Tune-Up Shop follows the revenue recognition principle. Otto services a car onAugust 31. The customer picks up the vehicle on September 1 and mails the payment toOtto on September 5. Otto receives the check in the mail on September 6. When shouldOtto show that the revenue was recognized? 46. The expense recognition principle states that expenses should be matched with revenues.Another way of stating the principle is to say that: a.assets should be matched with liabilities.b.efforts should be matched with accomplishments.c.dividends should be matched with stockholder investments.d.cash payments should be matched with cash receipts. 47. A flower shop makes a large sale for $1,000 on November 30. The customer is sent astatement on December 5 and a check is received on December 10. The flower shopfollows GAAP and applies the revenue recognition principle. When is the $1,000considered to be recognized? Fall 2016 - BUA 201 ( Principles of Financial Accounting ) – Review file for Exam 1 pg. 9
Fall 2016 - BUA 201 (Principles of Financial Accounting) – Review file for Exam 1 pg. 10
48. A furniture factory's employees work overtime to finish an order that is sold on January31. The office sends a statement to the customer in early February and payment isreceived by mid-February. The overtime wages should be expensed in:
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