Discussion Week #2
No, I don't believe cash basis is appropriate to use in accounting. Cash basis accounting recognizes
revenues when cash is received, also recording expenses when cash is paid. Accrual accounting better
reflects the business's performanc
Please prepare the journal entries for the following at month end.
The equipment that was contributed has a useful life of 10 years with a $2000 salvage
value. The company has decided to use the double declining balance method for
depreciating this asset.
Transactions for July
July 1 Cash.101
Owner invested in business in exchange for
2 Rent Expense.640
Paid one months rent.
5 Office Supplies.124