Q#17: Continue with Zeal Company above. Consider the $12 of interest income reported on the June bank statement as well as the following categories discussed in class for adjusting journal entries. Select the true statement below. (i) Accrued Revenue (ii) Adjustment of an existing deferred revenue (iii) Error Correcting. A. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (i) above. B. Zeal would make a June AJE: debit Interest Receivable $12 and credit Interest Income $12. Classification: (i) above. C. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (iii) above. D. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (ii) above. E. Zeal would make a June AJE: debit Interest Receivable $12 and credit Interest Income $12. Classification: (iii) above.
Q#17: Continue with Zeal Company above. Consider the $12 of interest income reported on the June bank statement as well as the following categories discussed in class for adjusting journal entries. Select the true statement below. (i) Accrued Revenue (ii) Adjustment of an existing deferred revenue (iii) Error Correcting. A. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (i) above. B. Zeal would make a June AJE: debit Interest Receivable $12 and credit Interest Income $12. Classification: (i) above. C. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (iii) above. D. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (ii) above. E. Zeal would make a June AJE: debit Interest Receivable $12 and credit Interest Income $12. Classification: (iii) above.
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter5: Accounting Systems
Section: Chapter Questions
Problem 2PB: Transactions related to revenue and cash receipts completed by Sterling Engineering Services during...
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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Transcribed Image Text:Q#17: Continue with Zeal Company above. Consider the $12 of interest income reported on the June bank statement as well as the
following categories discussed in class for adjusting journal entries. Select the true statement below.
(i)
Accrued Revenue (ii) Adjustment of an existing deferred revenue (iii) Error Correcting.
A. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (i) above.
B. Zeal would make a June AJE: debit Interest Receivable $12 and credit Interest Income $12. Classification: (i) above.
C. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (iii) above.
D. Zeal would make a June AJE: debit Cash $12 and credit Interest Income $12. Classification: (ii) above.
E. Zeal would make a June AJE: debit Interest Receivable $12 and credit Interest Income $12. Classification: (iii) above.
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Step 1
Accrued revenue is that revenue which is earned but not yet received by the business. This is one of the current asset being used in business.
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