Lo 2-1

Question 1

according to FASB and GAAP, revenue should be recognized when?

Answer 1

in the period the service is provided, regardless of whether cash has or has not been collected.

Question 2

accrual accounting

Answer 2

recognizing revenue when it is earned and expenses when they are incurred, regardless of when the related cash is exchanged

Question 3

accounts payable

Answer 3

amounts owed but not yet paid to suppliers who have provided goods or services to the business

Question 4

accounts receivable

Answer 4

expected future cash receipts arising from permitting customers to buy now and pay later; typically relatively small balances due within a short period of time

Question 5

accrued expenses

Answer 5

expenses that are recognized before cash is paid.

Question 6

an example of accrued expenses is

Answer 6

accrued salaries expense

Question 7

cash basis accounting

Answer 7

recognize and report revenues and expenses in the period in which cash is collected or paid

Question 8

accrued accounting

Answer 8

recognizes or report revenues and expenses in the period in which they occur, regardless if cash is collected or paid

Question 9

accrual

Answer 9

revenue or expense event that is recognized before cash is exchange